Shares in cannabis producer Aphria shot up after it announced it would temporarily exit the US market while federal lawmakers reform marijuana legislation.

It inked a deal with an unnamed group of buyers to offload its remaining 64.1 million shares in Florida-based Liberty Health for $59.1 million. Yet it retained a five-year promissory note exchange due September 6, 2023, bearing annual interest of 12%, so it can return to the market further down the line.

“We view this decision as only a temporary departure from investment in the U.S. cannabis industry until such time as US federal cannabis laws are reformed,” said chief executive Vic Neufeld, who joined the firm from Canadian vitamin company Jamieson Laboratories.

“We have always believed in the tremendous opportunity in the US cannabis market, and that is no different today. Not only does this transaction result in a significant gain to the Company it also enables Aphria to advance its existing global strategic plan unencumbered by US exposure at this time.”

The firm now plans to concentrate on more immediate capital markets and opportunities in Canada and other legal markets around the world.

The market responded positively to the news, as the company’s share price surged. It’s now more than double the price seen a month ago, while shares in Liberty Health are also growing strongly.

It has enjoyed triple-digit gains over the past month, while patient numbers have risen to 10,000 and sales are soaring, so Aphria may well decide to buy back the shares in the future.

Aphria is based in Leamington, Ontario, where it produces pharmaceutical-grade cannabis at scale, and it is also present in 10 countries spread across five continents.

Leamington greenhouse operators Cole Cacciavillani and John Cervini set it up in 2014 and it has already gained a multibillion-dollar market capitalization. It has been on an aggressive expansion drive: earlier this year it bought Broken Coast Cannabis, a Vancouver Island cannabis producer, for $230 million, and then it snapped up Brampton-based Nuuvera for $826 million. In July it expanded into South America and Jamaica, buying Marigold Projects Jamaica and acquiring a subsidiary of Scythian Biosciences Corp.

Now it’s eagerly anticipating the legalization of cannabis in Canada next month. “When the opening bell rings, Aphria will be ready to hit the ground running and has the infrastructure, know-how and capacity to deliver on all of our supply commitments,” said Neufeld.

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