Aphria says review reveals conflict of interest of directors in acquisition
LEAMINGTON, Ont. — Cannabis producer Aphria Inc. says a review of its governance procedures revealed certain non-independent directors had conflicting interests in its acquisition of several Latin American companies.
The company said Friday that a separate review of the takeover of the companies in Jamaica, Argentina and Colombia found the purchase price for the deal to be within an acceptable range, and assets for all three companies were in place.
“The special committee’s findings give me and the board full confidence that it was executed at an acceptable value and is consistent with the company’s international growth strategy,” said the company’s independent board chairman Irwin Simon in a statement.
Aphria launched the reviews after short-sellers alleged in December that the acquisitions totalling $280-million were “largely worthless” and the purchase price “vastly inflated” to benefit insiders.
The company said it will adopt best practices to manage conflicts of interests, after it found some directors had not fully disclosed their conflicts to the board, as part of several recommendations put forth by the review committee.
The board will also be fully composed of independent directors once the company appoints a permanent CEO, the company said.