USA: Cannabis producer Green Thumb prepared to make an offer for merger with Boston Beer - report
Cannabis producer Green Thumb Industries is prepared to make an offer for a potential merger deal with U.S.-based brewer Boston Beer, according to a letter seen by Reuters.
Green Thumb CEO Ben Kovler in a letter to Boston Beer founder Jim Koch on June 2 said a combination would allow the cannabis producer, which is currently listed in Canada, to also be listed on a major U.S. exchange.
Green Thumb's move comes after Boston Beer said it was "fully focused" on its business as an independent company after the Wall Street Journal (WSJ) reported on Friday, May 31 that Japanese whisky maker Suntory Holdings was in early talks to acquire the U.S. brewer.
Suntory, however, said that it was not in negotiations to acquire Boston Beer.
In Kovler's letter to Koch, which was sent after the WSJ report on Suntory's interest, he said that Green Thumb would be able to make a "superior and more valuable offer" for Boston Beer.
Koch, who is also chairman of Boston Beer, has 100% of the voting rights of the company's Class B stock, according to Jefferies.
The WSJ earlier on June 4 had first reported about Green Thumb pursuing a merger with Boston Beer.
Green Thumb, in response to WSJ's report, said in a statement that it would not comment. Boston Beer also declined to comment when contacted by Reuters.
A deal between Boston Beer and Green Thumb could be difficult to pull off, given that cannabis consumption remains illegal at the federal level in the U.S., the WSJ had reported.
Green Thumb's Kovler in the letter also noted that a merger with Boston Beer will help the companies venture into multiple product categories including pre-rolls, edibles, and drinks, as well as vape, concentrates and topicals.
Shares of Boston Beer, which has a market capitalization of roughly $3.6 billion, were down marginally in afternoon trade. Including session moves, they have fallen about 4% since the market close on May 31.
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