Cannabis stocks continue to benefit from Schedule III optimism, with investors now watching a June 29 hearing on broader marijuana rescheduling.
- Tilray issued 398,666 shares for its Lyphe Group acquisition and another 1.21 million shares in a debt-for-equity exchange.
- The debt swap retired $6 million of 5.2% Convertible Senior Notes due 2027 without requiring cash.
- Tilray has drawn investor concern as the company becomes more beverage-focused through BrewDog and other beer brands.
Shares of Tilray Brands (TLRY) logged their second straight session in the green on Tuesday after the company disclosed the issuance of 1.6 million new shares to fund its acquisition of U.K.-based medical cannabis platform Lyphe Group and retired $6 million of debt.
TLRY stock jumped 3% on Tuesday to its best day in over two weeks.
TLRY Issues Shares For Lyphe Deal, Debt Swap
According to a fresh regulatory filing from Tuesday, Tilray issued 1.61 million shares across two transactions. The company issued 398,666 shares on April 15 as partial consideration for its acquisition of Lyphe Group, a U.K.-based medical cannabis clinic and digital pharmacy platform. It later issued 1.21 million shares on June 3 in a private debt-for-equity exchange, retiring $6 million of its 5.2% Convertible Senior Notes due 2027 without using cash.
The Lyphe deal was unveiled in April as part of Tilray's international expansion efforts, which provided the company with access to a platform that has treated over 16,000 patients and dispensed 150,000 medical cannabis units in the U.K. to date.
Tilray said the addition of Lyphe helps establish its first fully integrated medical cannabis ecosystem, combining pharma-grade cultivation and production with clinical care, dispensing services, and pharmaceutical distribution. The company expects the acquisition to boost its earnings next year.
Cannabis Reform Tailwinds For TLRY
The filing comes as cannabis stocks continue to benefit from growing optimism around U.S. cannabis reform. In April, Acting Attorney General Todd Blanche moved state-licensed medical marijuana products to Schedule III and launched the process for broader rescheduling. The change removed punitive tax treatment for licensed medical cannabis operators and improved industry sentiment.
Investors are now focused on a June 29 administrative hearing that will examine whether broader marijuana products, including adult-use cannabis, should also move to Schedule III. Proceedings are expected to run through July 15. Roth Capital recently called the rescheduling order "extremely favorable" for the cannabis sector, citing benefits for taxation, capital access, future uplistings and overall investability.
TLRY: Brewer Or Cannabis Play?
Tilray has increasingly focused on beverages over the past few months following its March acquisition of BrewDog assets. Recent announcements involving BrewDog, 10 Barrel Brewing, and SweetWater Brewing have fueled concerns among retail investors that Tilray is becoming more of a brewery than a cannabis company despite improving cannabis policy tailwinds.
However, CEO Irwin Simon has rejected the claims, saying that Tilray is building a diversified global consumer products platform spanning cannabis, beverages and wellness. While Tilray currently has no THC cannabis sales in the U.S., Simon recently said that it has already developed the “playbook,” genetics and medical research to move quickly into the U.S. cannabis market if regulations advance further.
How Do Retail Traders Feel About TLRY?
On Stocktwits, retail sentiment for TLRY jumped to ‘extremely bullish’ from ‘neutral’ levels a week ago amid an 117% jump in message volume over the same period.
One user said, “$TLRY now we need a partner in the US .... maybe $TCNNF [Trulieve Cannabis].”
View this Stocktwits post
Another user pointed to the new regulatory filing and said, “Who says it’s a good deal?”
View this Stocktwits post
TLRY stock has risen 26% over the past year.
For updates and corrections, email newsroom[at]stocktwits[dot]com.<
