Tilray says it expects to use the deal to jump into the CBD-derived product market in the United States. Tilray will be acquiring Manitoba Harvest from Compass Group Diversified Holdings in a deal that includes cash and class 2 Common Stock in the capital of Tilray, of up to C$419 million (US$318 million) depending on certain milestones being reached, according to Business Wire.
“Tilray’s acquisition of Manitoba Harvest is a milestone for the cannabis industry,” Tilray CEO Brendan Kennedy said in a statement. “It builds on the strategic partnerships we have formed with consumer brand industry leaders and demonstrates our track record of disrupting the global pharmaceutical, alcohol, CPG (consumer packaged goods) and functional food and beverage categories.”
“We are excited about being an important part of the growth strategy for Tilray,” said Bill Chiasson, Manitoba Harvest CEO. “By leveraging our combined strengths and capabilities, we will be able to accelerate our mission of transforming consumer health through the power of hemp.”
Tilray is acquiring a Manitoba hemp-food manufacturer, tapping into its extensive U.S. distribution network and an upcoming line of CBD products lBe4jSmSom
— Bloomberg (@business) February 20, 2019
Manitoba Harvest and Tilray
Winnipeg-based Manitoba Harvest was founded in 1998 and is the world’s largest vertically-integrated hemp food manufacturer. The company’s current 100 percent all natural products include hemp hearts, hemp protein powder, and hemp snacks and are carried in about 16,000 retail locations across the U.S. and Canada.
One of Manitoba Harvest’s very first products was Hemp oil, a raw, cold-pressed, vegan-friendly oil that contains omegas without any additives or coloring. However, it is the shelled hemp seeds that are at the heart of all the company’s foods.
Tilray is a Canadian pharmaceutical and cannabis company, incorporated in the United States with primary operations headquartered in Nanaimo, British Columbia. Tilray also has operations in Australia & New Zealand, Germany, Portugal, and Latin America.
Tilray also made a bit of history by becoming the first cannabis company to be listed on a major U.S. stock exchange in July 2018, when it debuted on the NASDAQ at a price of $17 per share and rose dramatically in September 2018 to $214 per share.
Marijuana company Tilray to buy hemp food-maker Manitoba Harvest for $317 mln MarketWatch (@MarketWatch) February 20, 2019
Hitting the CBD “brick wall” in U.S.
Tilray expects to launch CBD-infused products in the U.S. this summer. But the legal status of CBD products is still unclear. As long as CBD-infused products are derived from hemp, it’s legal to buy them over the counter. While hemp was legalized under the Trump administration’s Farm Bill, it still remains under the supervision of the Food and Drug Administration (FDA).
In December, when the FRA announced the guidelines regarding hemp use, FDA Commissioner Scott Gottlieb restated his agency’s stance that CBD is a drug ingredient and therefore illegal to add to food or health products without approval from his agency.
