What happened

Shares of Aphria (NYSE:APHA) soared 13.8% as of 3 p.m. EST on Thursday. The Canadian marijuana stock received a big boost after Bloomberg reported that Green Growth Brands (NASDAQOTH:GGBXF) is open to negotiations regarding its attempt to buy the company. Green Growth Brands first proposed to acquire Aphria in December and formally submitted its offer last week.

So what

Green Growth Brands' initial offer was pretty much dead on arrival. The U.S.-based marijuana grower proposed to acquire Aphria in an all-stock transaction valued at around $1.8 billion. But Aphria is worth significantly more than that now, with its market cap over $2 billion.

Marijuana leaves on top of a line chart going up

Image source: Getty Images.

Last week, Aphria urged its shareholders to take no action on the Green Growth Brands offer. The company stated that its board of directors was reviewing the proposal. However, Aphria's board determined that Green Growth's offer in December "significantly undervalued" the company. Green Growth's latest terms are essentially the same as what it floated a month ago.

Green Growth Brands CEO Peter Horvath told Bloomberg that "there's a chance the offer might change." But it would probably take a really big upwards revision to the company's bid for it to be attractive to Aphria shareholders. Until a much higher number is on the table, the potential that Green Growth could increase its offered price for Aphria doesn't mean very much.

Now what

Investors will certainly be interested in how Green Growth's hostile takeover attempt of Aphria plays out. The smart money right now, though, would be on this potential acquisition fizzling out. However, don't rule out the possibility that other companies might take a run at Aphria.

Despite its recent surge, Aphria's share price remains well below its high levels set in 2018. The company came under fire after short-sellers alleged that it drastically overpaid for the acquisition of LATAM Holdings last year. A special committee consisting of independent members of Aphria's board of directors is conducting a review about this acquisition.

Aphria is at a critical juncture with this review going on and its search for a new CEO. Current CEO Vic Neufeld and co-founder Cole Cacciavillani are stepping down from their executive roles. Aphria might not be very interested in Green Growth Brands' current offer, but it would likely consider selling if the price was right.

Keith Speights has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.