Market Overview

Aphria Begins Shipment To Shoppers Drug Mart, Completes Acquisition Of German Distributor

Aphria Begins Shipment To Shoppers Drug Mart, Completes Acquisition Of German Distributor

Aphria Inc (NYSE: APHA) is in the spotlight on the back of two developments.

What Happened

Shoppers Drug Mart recently launched its online portal for sale of medical cannabis and will have 10 licensed producer’s products to choose from.

Aphria said it completed its first shipment of medical marijuana to Shoppers Drug Mart. In this way, patients can now purchase Aphria's cannabis products via Shoppers Drug Mart's online store.

Separately, the Canadian cannabis producer announced it completed the acquisition of CC Pharma GmbH, a German-based distributor of pharmaceutical products. The deal was announced back in November. Aphria paid €24.5 million ($28.23 million) at closing, and will pay another €23.5 million if and when certain milestones are met.

Why This Is Important

Given that some analysts have been questioning the valuation of Canadian cannabis producers, M&A and supply agreements can potentially reassure investors about a company's growth potential.

The acquisition of CC Pharma solidifies Aphria's footprint in Germany as the country comes closer to legalization, which will most likely create a ripple effect throughout the EU.

The partnership with Shoppers Drug Mart also can create some opportunities. Currently, cannabis products can be purchased online, but Shoppers Drug Mart also has an extensive chain of over 1,300 pharmacies across Canada.

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What's Next

Aphria is in the middle of a takeover attempt by Green Growth Brands, which made a hostile offer to acquire the outstanding stock it doesn't already own.

Aphria is expected to report its fiscal Q2 results Jan. 11.

Related Links:

KushCo Reports 186% Year-Over-Year Revenue Growth, Bottom Line Loss In Q1

Aurora Cannabis Issues Below-Consensus Q2 Revenue Guidance

Posted-In: Canada CC Pharma Shoppers Drug MartCannabis M&A News Markets Best of Benzinga


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