Hiku Brands Co. agreed to buy WeedMD Inc. for about $243 million  in stock to add medical marijuana to its offerings as pot producers seek new partners ahead of legalization this year.

WeedMD shareholders will receive 1.4185 Hiku shares for each common share they hold, or about $2.52 each, 60 per cent higher than the closing prices on Wednesday. Hiku shareholders will own 52 per cent of the combined company, according to a statement Thursday.

BMO Capital Markets acted as the adviser for Hiku, the first big Canadian bank to lead a deal in the marijuana sector as companies fight for market share before the legalization of recreational pot this year. Canada’s marijuana industry is projected to reach as much as $12 billion a year in sales.

This year alone, Aphria Inc. agreed to buy Nuuvera Inc. for about $670 million and Aurora Cannabis Inc. bought CanniMed Therapeutics Inc. for $1.23 billion in stock in what was the biggest marijuana takeover at the time.

Eight Capital and Stoic Advisory were the financial advisers to WeedMD.

--With assistance from Jen Skerritt, Kristine Owram and Scott Deveau.