Aurora Cannabis is asking its shareholders to sit tight and treat Curaleaf Holdings’ hostile takeover bid with skepticism.
In a statement Monday, the Edmonton, Alberta-based global medical cannabis company also corrected what it called inaccurate statements Curaleaf made in support of its unsolicited $272 million takeover offer.
Aurora’s board and a newly formed special committee of independent directors are reviewing the bid, and the company advised shareholders to “take no action” until it issues a formal recommendation, according to the news release.
Why does Curaleaf Holdings want to buy Aurora Cannabis?
U.S.-based Curaleaf has offered $4 per share in a mix of stock and cash, making the total outlay $272 million, according to The Wall Street Journal.
Aurora’s leadership says that number undersells the real prize: its European manufacturing footprint, a key asset as North American cannabis firms jockey for a share of what most observers say is a steadily growing overseas market.
Canadian companies have to date mostly supplied cannabis to European markets such as Germany. Nealy half of the 203 metric tons of cannabis imported by Germany came from Canada, according to Stratcann.
However, there is a growing unwillingness in Europe to accept cannabis from Canada over European Union Good Manufacturing Practices-compliant supply grown locally, as MJBizDaily has reported.
And that’s what Curaleaf is trying to buy out at a fraction of its worth, according to Aurora Executive Chairman and CEO Miguel Martin.
“They are trying to acquire our world-class EU-GMP global infrastructure at the lowest possible price, depriving our shareholders of the long-term value our strategy is built to deliver,” Martin said in Monday’s statement.
EU-GMP certification, the standard a facility must meet to manufacture medicines for the European market, takes years and considerable capital to secure.
Aurora says it has increased its certified production capacity by more than 40% over five years, most recently adding capacity through its Safari Flower acquisition.
Curaleaf has acknowledged those facilities are the reason for the offer.
Have changes to Germany’s MMJ reimbursement program affected Aurora?
Curaleaf named Germany’s reimbursement changes as a major headwind for Aurora.
On July 30, Germany removed cannabis flower from statutory health insurance, shifting those patients to out-of-pocket purchases.
Aurora called that characterization incorrect.
The reimbursement segments accounted for less than 10% of its total German volume before the change, the company said.
Aurora reported international net revenue up 17% year over year in the first quarter of fiscal 2027, with Germany named as a key driver, though that quarter closed June 30 before the new rules took effect.
What is Aurora’s position in European cannabis?
In the meantime, Aurora has been strengthening its European operations.
On Aug. 19, it acquired UK companies Internode Pharma, a licensed importer and wholesaler, and licensed pharmacy HAP Pharma, expanding direct distribution in one of the region’s fastest-growing medical markets.
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The company also holds the No. 1 market share position by revenue in Poland, according to the news release.
But Aurora also carries $93.7 million in debt and posted an earnings-per-share loss of $0.97 in the first quarter of fiscal 2027, according to The Motley Fool.
Aurora said it has engaged with Curaleaf since June, most recently on Aug. 12. The offer remains open for at least 105 days.
