MedReleaf Corp. and Aurora Cannabis Inc. shares were briefly halted Thursday and resumed trading after the companies announced they have held discussions, but no agreement has been reached.
Trading resumed mid-afternoon after being halted “pending news” for several hours.
The companies issued press releases saying they were aware of media reports that MedReleaf was seeking a buyer.
Citing anonymous sources, The Globe and Mail reported that Markham, Ont.,-based MedReleaf was putting itself on the market and that Edmonton-based Aurora had submitted a friendly offer.
On Thursday afternoon, MedReleaf released a statement in response to a request by Investment Industry Regulatory Organization of Canada (IIROC), saying it was aware of a news article speculating about a potential transaction involving Aurora.
“MedReleaf does not publicly comment on unusual market activity, rumours or speculation in the marketplace or any potential transaction unless, and until, a binding legal agreement to effect that transaction has been signed,” it said.
It confirmed that it engages “from time to time” in discussions with other industry players, including Aurora Cannabis, “regarding various alternatives.”
“The company has not entered into an agreement to effect any particular transaction, and there can be no assurance that such discussions will result in any such agreement,” MedReleaf said.
Aurora also released a statement in response to a request from IIROC regarding reports involving a potential transaction with MedReleaf.
“The company does confirm that it engages in discussions with industry participants from time to time, including MedReleaf,” Aurora said in a statement on Thursday afternoon. “At this time the company confirms there is no agreement, understanding or arrangement with respect to any transaction with MedReleaf.”
Consolidation in the Canadian marijuana sector has been accelerating as the country prepares to legalize cannabis for recreational use later this year.
Aurora recently completed its acquisition of Saskatoon-based licensed producer CanniMed Therapeutics after striking a $1.1 billion stock-and-cash deal in January.
In February, rival licensed producer Aphria Inc. completed its acquisition of B.C.-based Broken Coast Cannabis Inc., a transaction valued at more than $200-million in stock and cash.
The Canadian Press