Aurora Cannabis seeks Nasdaq compliance via share consolidation

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Canadian producer Aurora Cannabis said it’s planning to consolidate its shares to restore compliance with the Nasdaq’s minimum bid-price requirement and ensure continued access to a range of institutional investors.

Aurora’s board of directors approved the plan to consolidate outstanding common shares on the basis of one share for every 10 shares currently outstanding, subject to regulatory and stock exchange approvals, the Alberta-based company said in a Wednesday news release.

The proposed plan would cut Aurora’s outstanding shares from 475,903,822 to 47,590,382.

Aurora expects the share consolidation to be effective around Feb. 20.

“We will continue to exercise financial discipline, and do not see this share consolidation as a distraction from our target of delivering positive free cash flow this calendar year,” CEO Miguel Martin said in a statement.

“Aurora is taking the required steps to comply with Nasdaq’s listing rules so that we can maintain the financial flexibility needed to continue our pursuit of profitable international growth.”

The Nasdaq requires a minimum bid price of $1 for listed equities.

The exchange considers a company deficient with the bid-price rule when shares fall below $1 for 30 consecutive trading days.

Aurora’s shares were trading at 38.7 cents on the Nasdaq late Wednesday morning.

In a fiscal 2024 update, Aurora said it still expects to post positive adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) and generate positive free cash flow in the calendar year.

Aurora is one of a number of cannabis companies currently on the Nasdaq’s list of noncompliant companies.

Others include:

  • Agrify Corp., which was added to the noncompliant list Dec. 1, 2023, because of an equity-related deficiency.
  • BYND Cannasoft Enterprises, which was listed as noncompliant on Jan. 5, 2024, over a bid-price deficiency.
  • Clover Leaf Capital Corp., which has a shareholders-related deficiency issued Aug. 31, 2023, and an annual general meeting deficiency from Jan. 23, 2024.
  • Flora Growth Corp., which has been deficient since Dec. 5, 2023, because of its audit-committee composition.
  • Greenlane Holdings, which has been noncompliant since Aug. 3, 2023, over a Nasdaq deficiency related to the market value of its publicly held shares and Aug. 21, 2023, because of its low stock price.
  • Hempacco Co., which is listed as noncompliant because of bid price (April 6, 2023), audit-committee composition (Nov. 15, 2023) and annual shareholder meeting (Jan. 9, 2024).
  • IM Cannabis Corp., which has been noncompliant since Aug. 1, 2023, because of its low stock price.
  • InMed Pharmaceuticals, which has been noncompliant since Sept. 19, 2023, because of its stock price.
  • Leafly Holdings, which was added to the Nasdaq’s noncompliant list Jan. 3, 2024, over a deficiency involving its audit committee composition.

Matt Lamers can be reached at matt.lamers@mjbizdaily.com.