Aurora Cannabis’ board on Wednesday yet again formally rejected an unsolicited hostile takeover bid from U.S.-based multinational cannabis company Curaleaf Holdings.
But other acquisition offers may be welcomed, as Canada-headquartered Aurora, which carries no debt and has an enviable position in the emerging European cannabis market, is “carefully evaluating strategic alternatives,” CEO Miguel Martin said in a statement.
Leadership at Curaleaf and Aurora have been locked in a war of words since August, when Curaleaf first formally launched a $272 million hostile takeover effort.
That opening bid, which valued Aurora at $4 a share, was increased to $5 per share in a revised Oct. 5 offering.
Is Curaleaf Holdings going to take over Aurora Cannabis?
Martin and Aurora’s board dismissed both offers amid criticism from observers, who pointed out that Aurora shareholders would receive less cash for their shares than they would shares of Curaleaf.
“Aurora is debt-free with a strong cash position, and we believe the revised Hostile Bid continues to ask shareholders to give up that strength, and their future upside, at a discount,” Martin said in a statement Wednesday.
And Curaleaf has nearly $1 billion in debt, compared to an Aurora free of debt aside from lease liabilities.
In the meantime, as Cultivated News first reported, Aurora discussed an acquisition with fellow Canadian licensed producer Organigram, which is partly owned by British American Tobacco.
In a post on X on Wednesday, Boris Jordan, Curaleaf’s founder, chairman and CEO, called Aurora’s reaction “grossly inadequate and negligent to its shareholders.”
Aurora “has stated it has begun a process with multiple parties yet is purposely excluding the largest cannabis company in the world that’s made a real bid with a clear path to value creation,” wrote Jordan, who accused Aurora of refusing to provide “due diligence access.”
“Make it make sense!” he added.
Why is Aurora Cannabis an attractive M&A target?
Observers have pointed out that Curaleaf, which boasts its “largest in the world” status thanks to aggressive expansion in Europe, likely wants to acquire Aurora’s European Union GMP-certified facilities. Aurora recently announced an expansion of a cultivation and processing facility in Germany.
However, the final decision is up to Aurora shareholders, who have until December to decide whether to accept Curaleaf’s revised offer.
Said Aurora’s Martin: “We urge shareholders to keep their options open, reject the revised Hostile Bid and take no action until they can consider all the alternatives available to them.”
Shares in Aurora, listed on Nasdaq, were trading around $4.10 on Thursday afternoon. Shares in Curaleaf, which is still listed on OTCQX in the U.S. despite an effort to uplist to the New York Stock Exchange, were trading at around $8.40 on Thursday, down from a recent peak on Sept. 23 of $11.90.
Martin has told MJBizDaily that the company remains focused on medical markets such as that in Germany, where patients can be reimbursed for cannabis products via that country’s subsidized healthcare system.
