Pot Producer Hexo Sinks as Tilray Looks to Buy at a Discount (1)

US-listed shares of Hexo Corporation tumbled as Tilray Brands plans to buy the fellow cannabis company in an all-share deal worth about $56 million, with an offer price less than the stock’s market value prior to the announcement.

Tilray’s implied purchase price in the so-called takeunder deal is $1.25 per share, less than Hexo’s Monday closing price of $1.64. On Tuesday, Hexo plunged 27% to $1.20 — paring Monday’s 30% rally, which was triggered by a media report implying that Tilray would buy the company for $75 million.

“The deal is at a discount and with room for material upside ...