A U.S. cannabis company has made an unsolicited bid to takeover Aurora Cannabis Inc., a company based in Edmonton. Aurora has formed a special committee to consider the offer. Curaleaf Holdings Inc., based in Stamford, Conn., and traded on the Toronto Stock Exchange, revealed its intention to purchase all shares of Aurora.
The proposed acquisition aims to create a combined cannabis company with operations in 17 countries across Europe, North America, and other global markets. Curaleaf stated that despite attempts to negotiate privately with Aurora, the latter’s board declined to engage in discussions following the submission of formal letters of intent on June 23 and July 7.
Curaleaf has proposed a payment of $4 US per share to Aurora shareholders, in addition to $0.75 US cash for each Aurora share. However, Aurora disputed Curaleaf’s claim that it refused to engage with the offer, stating that communication between the companies continued as of July 24. Aurora’s independent directors will form a committee to evaluate the proposal’s viability and its impact on stakeholders.
While acknowledging Curaleaf’s interest, Aurora emphasized that the current offer undervalues its long-term potential. Analysts also expressed similar views, suggesting that Aurora’s market leadership, product portfolio, financial strength, and regulatory expertise position the company for significant future growth.
Curaleaf believes that merging with Aurora would create value by leveraging its global distribution network with Aurora’s medical cannabis franchise and production capabilities. The combined revenue of both companies exceeded $1.5 billion US in the last 12 months, with Curaleaf expecting annual cost synergies of at least $40 million US post-acquisition.
Curaleaf’s CEO, Boris Jordan, views the potential merger as beneficial for shareholders of both companies, offering Aurora investors an opportunity to participate in a diversified global platform and benefit from U.S. regulatory developments.