Edmonton, Alberta-based Aurora Cannabis is investing “a significant equity stake” in upstart Netherlands-based Growery B.V., one of only 10 lottery winners selected to cultivate and distribute adult-use marijuana to retailers under a government-backed pilot program.
Aurora did not say in a news release how much of Growery it is acquiring, nor did it disclose the price.
The planned acquisition comes about a month after Aurora competitor Village Farms International paid almost 4 million euros ($4.6 million) for an option to purchase an 80% stake in Netherlands-based Leli Holland B.V. – another of the 10 winners.
Village also owns Canadian licensed producer Pure Sunfarms, which is based in British Columbia.
Some Canadian LPs have increasingly focused their M&A on actual cannabis revenue rather than potential revenue overseas that might never come to fruition.
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Aurora said it intends to invest an “immaterial cash amount,” a portion of which is due upfront, in Growery.
The remainder will be dependent on the Dutch company achieving undisclosed milestones.
Aurora said it will provide Growery with:
- A loan to construct its facility and fund early operations.
- Technical and operational support.
“Our investment in Growery is a significant advancement for our global recreational cannabis strategy,” CEO Miguel Martin said in the release.
“The Netherlands is expected to be the largest federally regulated recreational market outside of Canada, and is a proof point that our medical market success in Europe is portable to recreational markets.”
The Dutch pilot program involves 10 cultivators supplying almost 80 retailers, known as coffee shops.
Those stores currently operate in a system where sales are legally tolerated but marijuana cultivation has been prohibited.
Shares of Aurora trade as ACB on the Toronto Stock Exchange and the Nasdaq.
