U.S.-based marijuana multistate operator Curaleaf Holdings wants to buy out Canadian licensed producer Aurora Cannabis.
And after Aurora’s leadership declined to discuss a deal, Curaleaf will pitch Aurora’s shareholders on approving the hostile takeover, Curaleaf said in a press release Tuesday.
Curaleaf said it intends to launch a takeover bid for all outstanding Aurora shares, offering $4 per share in a mix of Curaleaf stock and $0.75 cash per sale, according to a news release the company issued Tuesday.
The total outlay for Curaleaf would be $272 million, according to the Wall Street Journal. Shares in Aurora stock, which trade on Nasdaq, jumped 22% Tuesday to $3.48. Curaleaf stocked jumped to $9.93.
Is Curaleaf Holdings buying out Aurora Cannabis?
“This deal changes the game for both sets of shareholders,” Curaleaf CEO Boris Jordan wrote in a post on X.
“Aurora shareholders receive a significant premium and immediate value. Curaleaf shareholders gain a business that is immediately accretive and strategically complementary to what we have built internationally.”
The combined company would operate in 17 countries, with more than $1.5 billion in trailing 12-month revenue and nearly $350 million in adjusted earnings, Curaleaf said.
The price is 45% above Aurora’s 30-day volume-weighted average price of $2.75, according to the news release.
The hostile takeover follows resistance from Aurora’s c-suite, according to Curaleaf. CEO Boris Jordan sent a formal letter to Aurora CEO Miguel Martin on June 23, then followed up on July 7.
Aurora has not responded, according to Curaleaf, which earlier this summer announced a 1-for-3 reverse stock split in preparation for uplisting to the New York Stock Exchange.
However, Curaleaf is still trading on OTC markets for now.
Martin did not immediately respond to a request for comment from MJBizDaily.
What would the combined company look like?
The deal would combine two of the cannabis industry’s largest international operators and expand Curaleaf’s cultivation capacity outside the United States.
Taking over Aurora would add more than 50 tons of annual EU-GMP cultivation and manufacturing capacity, including from its recent acquisition of Safari Flower Co., according to the release.
Curaleaf boasts a distribution network with operations in Germany, the United Kingdom and Poland as well as EU-GMP facilities in Portugal, Spain and Canada.
Aurora shareholders don’t have a formal offer yet.
Subscribe to the MJBiz Factbook
Exclusive industry data and analysis to help you make informed business decisions and avoid costly missteps. All the facts, none of the hype.
What you will get:
- Monthly and quarterly updates, with new data & insights
- Financial forecasts + capital investment trends
- State-by-state guide to regulations, taxes & market opportunities
- Annual survey of cannabis businesses
- Consumer insights
- And more!
Curaleaf said it would provide full terms in takeover documents it plans to file with Canadian securities regulators and the U.S. Securities and Exchange Commission, the news release stated.
After the process starts, the offer will remain open for 105 days unless Curaleaf extends, accelerates or withdraws it.
