Tilray is a brand that is synonymous with cannabis in Canada. It is now positioned to be a household CBD product brand in the U.S as well. In their most significant acquisition to date, Tilray has struck a deal with Manitoba Harvest Company. An agreement which involved stock options and cash landed Manitoba Harvest under the Tilray portfolio. Tilray which is known for quality cannabis products hopes to venture into the hemp CBD Market in the lower 48.
Manitoba Harvest Hemp Foods
Manitoba Harvest Hemp Foods is the world’s largest hemp food manufacturer to grow, make and sell their own brand of hemp food products. A B Corp Certified company, Manitoba Harvest educates on the health and environmental benefits of hemp and strives to support sustainability in all that they do. Products include Hemp Hearts, and a full line up for hemp protein and hemp snacks. Manitoba Harvest is a portfolio company of Compass Diversified Holdings (NYSE: CODI).
Details of the Acquisition and the Plan
The deal struck between Tilray and Manitoba Harvest has a value of $317M. Tilray stocks jumped nearly 5% after acquiring world’s biggest hemp food manufacturer in a cash-and-stock deal.
According to the CEO of Manitoba Harvest, the plan is for Tilray and Manitoba Harvest to release a product line that includes CBD gel caps, a CBD spray, and CBD infused tinctures. While any products offered through the company at this time would require FDA approval, Tilray is hopeful to have CBD products on US shelves later this year.
This acquisition couldn’t come at a better time from a business perspective. This is because just last fall the 2018 U.S. Farm Bill officially legalized industrial hemp. Industrial hemp is a primary plant in which CBD exists. The FDA requirement on CBD ingestible products, however, remains under great scrutiny of the Food and Drug Administration. This is where Tilray and Manitoba Harvest may have to acquire FDA approval before releasing their CBD products in the United States.