Acquisition of a Medical Cannabis Company
Our client, a registered investment advisor and fund manager of several hedge and private equity style funds, desired to acquire a controlling interest in a publicly-traded Canadian medical cannabis company. Tannenbaum Helpern acted as U.S. counsel and general counsel overseeing a Canadian law firm with respect to the transaction, which involved complex M&A, securities, financial services and regulatory components. The transaction was structured as a club deal with two well-known Canadian entities taking smaller minority positions in the target alongside our client.
Critical deal issues involved:
- walling the target off from the U.S. marijuana business due to ongoing Federal constraints; corporate governance and control rights;
- obtaining consents and additional funding from fund investors; and, simultaneously negotiating with a significant investor in the target for a portion of its block of shares and with the target for a primary issuance of additional shares.