Canada-based marijuana production and processor Tilray Inc. has laid out its plans to be the first company in the once-clandestine sector to debut on Nasdaq Inc.’s NDAQ, +0.68%[1] Global Select Market exchange.
Tilray TLRY, +0.00%[2] filed for its initial public offering in June, and the stock is expected to list in July under the ticker symbol TLRY. According to Securities and Exchange Commission filings[3], the company hopes to price shares at $14 to $16, which would raise up to $135 million at the midpoint of that range.
Here’s what you need to know
A first for a pot company
While Tilray is not the first cannabis company to list on the Nasdaq — at least one, Cronos Group Inc. CRON, -0.14%[4] is cross-listed on the Nasdaq and TSXV — Tilray will be the first cannabis cultivator to raise capital via a Nasdaq listing. One other, called Innovative Industrial Properties Inc. IIPR, -0.65%[5] went public on the New York Stock Exchange, but unlike Tilray, it is more of a real-estate investment trust, not an actual pot producer.
See also: The startup burning $1 million a month in hopes of selling $1 billion of pot a year[6]
Marijuana remains a decidedly complex regulatory issue in the U.S., but Canada has been fertile ground for the growing industry, according to Scott Greiper, president and founder of Viridian Capital Advisors, a U.S.-based investment bank that focuses on the cannabis sector. Canada is the first industrialized country to legalize recreational pot and has had a booming medical business for years; and it may have been no coincidence that Tilray filed for its IPO the day after Canada set the October date[7] for adult recreational cannabis use.
Viridian has tracked pot-related capital markets transactions since 2014, and Greiper says that its investments have always been Canada-heavy as the institutional money continues to chase value up north. But as the cannabis industry’s perceived legitimacy — and legality — grows, American stock exchanges have warmed up to listing companies that grow and process the plant. That’s where Tilray fits in.
“In general, U.S. capital markets have generally been closed to growers,” said Greiper. “Tilray is reflecting that exchanges like Nasdaq and New York [Stock...