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The U.S. Multi-State Operators and Canadian Licensed Producers are outperforming in the morning hours Wednesday as the cannabis industry shows signs of consolidation with two newly announced deals.
On Tuesday after the close, Edmonton, Canada-based Aurora Cannabis (NASDAQ:ACB) announced an agreement to acquire TerraFarma for $38 million in cash and stock.
Its U.S. counterpart, Cresco Labs (OTCQX:CRLBF), followed up on Wednesday with plans to acquire the rival MSO, Columbia Care (OTCQX:CCHWF) for nearly $2 billion, including debt.
In addition to Aurora Cannabis (ACB), notable gainers include Tilray (NASDAQ:TLRY), MedMen Enterprises (OTCQB:MMNFF), HEXO (NASDAQ:HEXO), Canopy Growth (NASDAQ:CGC) and Sundial Growers (SNDL).
Early this month, Tilray (TLRY) agreed to acquire more than $211 million worth of convertible notes issued by, Hexo (HEXO), allowing its local rival to avoid a major default of debt.
The uptick in cannabis stocks comes at a time the sector has underperformed the broader market in the year so far, as shown in this graph.
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