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LEAMINGTON, Ont. — Licensed marijuana producer Aphria Inc. has signed a deal to buy Broken Coast Cannabis Inc., a cannabis producer on Vancouver Island, in a transaction it valued at $230 million in cash and stock.

Under the agreement, Aphria will pay up to $10 million in cash with the remainder in shares based on a deemed price of $15.09 per share.

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“Adding one of Canada’s most sought after premium brands represents a major triumph for Aphria and our shareholders and firmly establishes our position as a Canadian leader in premium indoor cannabis production,” said Aphria chief executive Vic Neufeld in a statement Monday.

As of 10:00 a.m., Aphria’s stock was up 9 per cent to $19.64.

Broken Coast operates an indoor cannabis production facility on Vancouver Island that it is expanding. As part of the transaction, Aphria has approved a further expansion project that is expected to increase the facility’s annual capacity to 10,500 kilograms per year. The deal is anticipated to close by Jan. 31.