Aphria and Tilray, two Canadian giants in cannabis, have agreed to combine operations and form an international bohemoth with combined equity value of approximately 5 billion Canadian dollars ($3.9 billion).

The merged entity includes Manitoba Harvest, a Winnipeg maker of hemp food products that was acquired last year by Tilray.

Based on data reported by Aphria and Tilray, the new company takes the title of largest global cannabis company. It would have had a 12-month revenue of CA$874 million, beating out industry giants Curaleaf and Canopy Growth for, according to a joint statement released on Wednesday.

Under the all-stock deal, the combined company would operate under the Tilray name, with head offices in the United States, Canada, Portugal and Germany.

In addition to competing in Canada’s recreational marijuana market, Aphria and Tilray said the new company would be “well-positioned” to pursue European growth opportunities, building on Aphria’s German assets and Tilray’s Portugal production facility.

The companies also highlighted their consumer packaged goods infrastructure in the U.S., including Aphria’s recently acquired craft brewer SweetWater Brewing Co. and Tilray’s Manitoba Harvest hemp and CBD product business that boasts access to 17,000 stores in North America.

Tilray expanded into the natural foods category with the acquisition of hemp foods company Manitoba Harvest last year.

The new company plans to leverage Manitoba Harvest’s hemp and wellness product platform and “pursue the opportunity to expand with new or existing CBD or other cannabinoid brands,” the statement read.

“When U.S. regulations allow, the Combined Company expects to be well-positioned to compete in the U.S. cannabis market given its existing strong brands and distribution system in addition to its track record of growth in consumer-packaged goods and cannabis,” Tilray and Aphria said.

Under the deal, structured as a reverse acquisition of Tilray, each Aphria shareholder would receive 0.8381 Tilray shares for each Aphria share held, meaning Aphria shareholders would own roughly 62% of outstanding Tilray shares.

That represents a 23% premium over Tilray’s share price at market close on Tuesday.

The combined firm would be led by Aphria CEO Irwin Simon and a nine-person board of directors – seven directors from Aphria, including Simon, and two from Tilray, including Tilray CEO Brendan Kennedy.

Tilray shares trade as TLRY on the Nasdaq exchange, and Aphria shares trade as APHA on the Nasdaq and the Toronto Stock Exchange.

Read more about this deal at Marijuana Business Daily International.