Liberty Health Sciences Inc. (OTCMKTS:LHSIF) has announced the signing of a definitive agreement with Ayr Strategies Inc. (OTCMKTS:AYRWF). According to the agreement, Ayr will acquire all outstanding and issued Liberty shares in an all-share deal for a total consideration of $290 million on a fully-diluted basis.
Ayr to acquire Liberty
Under the agreement terms, Liberty shareholders will receive 0.03683 restricted/subordinate voting share for every Liberty share they hold. The exchange ratio means that one Liberty share is valued at $1.05 which is a premium of around 94% on the closing price of Ayr and Liberty Shares as of December 21, 2020. This transaction offers Liberty stockholders full upside participation to benefit from Ayr’s stock price currently trading at discount prices despite surging 400% in 2020.
Most importantly, Liberty stockholders will hold around 20% in the pro forma entity allowing them to benefit from the value created through the deal. The combined entity will boost geographical footprint with operations in states such as Florida, New Jersey, Ohio, Arizona, Pennsylvania, Massachusetts, and Nevada and thus position Ayr as a leading multistate operator. On the other hand, liberty and its shareholders will benefit from enhanced scale, capital market presence and in the US to accelerate growth and boost market share in Florida.
Transaction to help companies grow across states
George Gremse, Liberty’s interim CEO and Director, said that the transaction is a win-win-win for the company’s shareholders, stakeholders, and patients. He said that with support from Ayr, they will accelerate dispensary opening across the state and enhance product expansion, Gremse said that shareholders will benefit from the strong growth in Florida as well as in other states.
Ayr Strategies CEO, Jonathan Sandelman said that the transaction is a huge step for the company to becoming a multistate operator. He said that the company’s strategy has been going into the best markets and targeting attractive assets in limited license state where they can create a vertically integrated presence and have an edge. He added that in 2021 Ayr Strategies will grow in the recreational adult-use market.
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