CanniMed Therapeutics Inc. is postponing a key shareholder meeting to give it time to hold talks with Aurora Cannabis Inc., which has made a hostile takeover offer for the company.
CanniMed shares, which were halted earlier in the day pending news, shot up as high as $34.74 after they resumed trading on the TSX. The stock later gave up some of its gain to trade up $4.50 at $32.32. Shares of Aurora were up 4.7 per cent at $12.90.
The meeting had been set for Jan. 23 for CanniMed shareholders to vote on its plan to issue shares in its acquisition of Newstrike Resources Ltd. The meeting will now be held on Jan. 25.
CanniMed cautioned “there is no certainty that any such discussion will result in an agreement among the parties in respect of a transaction or in any change to the terms of Aurora’s offer.”
Aurora has made an all-stock offer for the company worth up to $24 per share. However, the offer requires CanniMed to drop its plans to acquire Newstrike.
CanniMed has urged its shareholders to vote in favour of the Newstrike deal, but three of the Saskatoon-based company’s biggest shareholders representing 38 per cent of outstanding shares have signed lock-up agreements backing Aurora’s bid.
Newstrike shareholders voted overwhelmingly in favour on Wednesday of the acquisition of the company by CanniMed.