Aurora Cannabis decided not to renew a contract to produce recreational marijuana in Uruguay, and the Canadian company is “actively marketing” a facility in the South American country, a spokeswoman confirmed to MJBizDaily.
The move, first reported in local media, marks a continuation of large Canadian licensed producers shedding assets in small international markets.
Last week, Ontario-based Canopy Growth sold a facility in Denmark to Australia’s Little Green Pharma for 20 million Canadian dollars ($16.2 million).
The Canadian company had spent significantly more building out the facility, according to a Danish regulatory filing.
Aurora spokeswoman Kate Hillyar said the decision to not renew the recreational cannabis production contract was made so the company can refocus on higher margin medical cannabis and CBD products “to serve our patients and consumers in Uruguay and other countries in the region.”
“After much consideration, Aurora has decided not to renew our contract to produce recreational cannabis in Uruguay,” Hillyar said via email.
“As this is a recent decision, we are working to minimize the number of people impacted and are actively marketing the facility for alternative use.
“We remain fully committed to our international medical cannabis strategy, where we are leaders in geographic reach with medical cannabis sales in 13 countries.”
Aurora acquired ICC Labs three years ago in an all-stock deal worth CA$262.9 million.
The subsidiary operates a facility in Canelones.
The 21,000-square-foot facility had a production capacity of 27,135 kilograms (59,822 pounds) per year at full operation, according to a regulatory filing in 2020.
According to another filing, ICC was constructing a facility in Uruguay designed to add 1 million square feet of greenhouse production, but it is not clear if that greenhouse was ever completed.
Between the acquisition date and June 30, 2019, ICC accounted for CA$600,000 in revenue and a loss of CA$9.3 million, according to Aurora’s annual financial statements last year.
Aurora already sold two properties in the country in relation to its business transformation plan.
One sold for CA$1.1 million, resulting in a CA$500,000 loss. The other sold for CA$300,000, per regulatory filings.
Matt Lamers is Marijuana Business Daily’s international editor, based near Toronto. He can be reached at [email protected].