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Although we know as fact that Canada, as a nation, is the global leader in ending prohibition as well as being the leader in embracing the science and medical research that may lead rise to a global paradigm shift away from traditional synthetic pharmaceuticals – in addition to the many other applications of cannabis and hemp (textiles, building materials, plastic substitute, bio fuel, animal care, cosmetics and skin care, health & wellness, etc) … regardless of those facts , at the end of the day, Canada’s population is less than California’s.
Although the Canadian dollar was trading above the US dollar not all that long ago, it is currently trading at a significant discount in the $0.75 range. What does that mean?
When cannabis is finally rescheduled in the US, we can look for not only increased M&A within the US but also internationally as American companies look to take over their global leading counterparts up there in the Great White North. Why spend money and resources inhouse when best in class may be acquired and potentially at a discount given the low Canadian dollar. Many of the top revenue companies within the US also trade on the Canadian markets making an investment in these companies at the retail and individual level possibly quite appealing. The Canadian dollar should recover and when it does any F/X gain may be an ancillary ROI. Back to M&A …
There is one such hostile takeover currently underway but once you scratch the surface it soon, at least in the opinion of some, begins to resemble a reverse takeover – the hostile take-over offer by Green Growth Brands Ltd (CSE:GGB; OTC:GGBXF) of Aphria Inc (TSX:APHA; NYSE:APHA) – Aphria is a top Canadian Licensed Producer. Once you factor in the $0.75 Canadian dollar, this may appear attractive indeed for GGB. This type of takeover is commonly referred to as a “takeunder”.
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