AURORA CANNABIS IN COM NPV(OTCMKTS:ACBFF) has seen a spectacular rise in recent weeks rising from well under $2 a share to recent highs of $11.83. ACBFF was trading well below the $0.25 mark back in 2015 and has transformed since then into a volume leader and major mover.
ACBFF is becoming a major player in the booming Marijuana industry that has quickly turned into a multi-billion dollar massive growth market that is sweeping across North America. In the US legal Marijuana sales grew by an unprecedented 30% in 2016 to $6.7 billion as the legal market expands in the U.S. and Canada, according to a new report by Arcview Market Research. North American sales are projected to top $20.2 billion by 2021 assuming a compound annual growth rate of 25%. The report includes Canada for the first time as it moves towards implementing legal adult use marijuana.
AURORA CANNABIS IN COM NPV(OTCMKTS:ACBFF) wholly-owned subsidiary, Aurora Cannabis Enterprises Inc., is a licensed producer of medical marijuana pursuant to the Marihuana for Medical Purposes Regulations and operates a 55,200 square foot, expandable, state-of-the-art production facility in Mountain View County, Alberta, Canada. Aurora trades on the Canadian Securities Exchange under the symbol “ACB”.
Aurora’s business strategy is to continue and accelerate its penetration of the Canadian cannabis market, achieve its Health Canada sales license for derivative products (cannabis oils) and launch derivatives sales, transition to profitability in the short-term, and begin a major expansion of production capacity. When the federal government passes legislation legalizing the consumer use of cannabis, the Company anticipates participating in the non-medical consumer market, and will envision further production capacity expansion to meet future market demand for cannabis products.
Earlier this year ACBFF announced progress on their memorandum of understanding (“MOU”) with Radient Technologies (“Radient”) (TSXV: RTI) pursuant to which Radient and Aurora are working to confirm the effectiveness of Radient’s MAPTM technology for cannabis extraction. Initial results from the first phase of the study are encouraging. As a result, the parties have agreed to move to the second phase of the project, which includes preliminary scale-up activities. The second phase of work under the study has commenced and is expected to take approximately eight weeks.
ACBFF CEO Terry Booth said “We are pleased with progress to date in assessing the feasibility of this potentially ground breaking extraction technology. The potential to substantially increase our extracts production capacity while maintaining terpene profiles would further differentiate our Company, and we are excited to be exploring this opportunity further in the coming weeks.”
Aurora completed its investment in the Radient convertible debenture which will have a principal amount of $2 million, a term of 2 years, bear interest at 10% per annum, and will be convertible into units of Radient at a conversion price of $0.14 per Unit. Each Unit will be comprised of one common share of Radient and one share warrant, exercisable within 24 months, for one common share of Radient at an exercise price of $0.33 per warrant. The Debenture will be repayable on demand from Aurora at any point within five months from the date of issuance.
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In June ACBFF announced Aurora will be making a strategic investment in Hempco for an ownership stake of up to 19.9% on a fully diluted basis, subject to Regulatory and Board approvals, as well as satisfactory completion of due diligence. Additionally, subject to customary conditions, Aurora will obtain an option to acquire shares from the majority owners of Hempco that, upon exercise of the option, will bring Aurora’s total ownership interest in Hempco to 50.1% on a fully diluted basis.
Hempco is one of the world’s largest industrial producers of hemp and hemp products, and currently offers three primary product lines: (1) bulk and packaged food products (e.g. hemp protein powder, hemp seeds or hearts, hemp oil etc.); (2) hemp fibre; and (3) nutraceuticals. Hempco’s line of packaged foods are sold under the brand “Planet Hemp” and are distributed globally in seven countries.
On January 5 ACBFF announced its intention to purchase common shares of CanniMed (the “CanniMed Shares”) in its Offer to Purchase and Takeover Bid Circular dated November 24, 2017, which is filed on SEDAR under CanniMed’s SEDAR profile. CanniMed implemented a shareholder rights plan on November 28, 2017, which prevented Aurora from commencing purchases in a timely fashion. The Ontario Securities Commission and the Saskatchewan Financial and Consumer Affairs Authority, in joint decisions dated December 22, 2017 and issued on December 27, 2017, cease traded the CanniMed rights plan.
The purchases were made by Aurora in the normal course through the facilities of the TSX.
Name of the Purchaser: Aurora Cannabis Inc.
Number of CanniMed shares purchased on January 5, 2018: 24,600
Highest price paid for the CanniMed shares on January 5, 2018: $23.99
Aggregate Number of CanniMed Shares Purchased through a published market since the Commencement of the Offe: 682,400
Average price paid for the CanniMed shares purchased through a published market since the Commencement of the Offer: $23.0181
Total Number of CanniMed Shares held by Aurora after the Purchase: 682,400
How to Tender
Aurora encourages CanniMed shareholders to read the full details of the Offer set forth in the takeover bid circular and accompanying offer documents, (collectively, the “Offer Documents”), which contain detailed instructions on how CanniMed shareholders can tender their CanniMed common shares to the Offer. For assistance in depositing CanniMed common shares to the Offer, CanniMed shareholders should contact the depositary and the Information Agent for the Offer, Laurel Hill Advisory Group at Phone: 1-877-452-7184 (North American Toll Free Phone) and 1-416-304-0211 (Outside North America); Facsimile: 416-646-2415; and E-mail: email@example.com.
About the Offer
On November 24, 2017, Aurora formally commenced its Offer to purchase all of the issued and outstanding common shares of CanniMed for consideration consisting of common shares of Aurora. The Offer Document, including the takeover bid circular and related documents are available on SEDAR.
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Currently trading at a $3.9 billion market valuation ACBFF has been putting out some really impressive numbers reporting $111 million in the treasury and$5,175,304 in sales for the 3 months ended March 31, 2017 up from just $219,230 for the same period last year. ACBFF is also reporting a whopping $111,116,196 in cash in the treasury which really sets this company apart from its peers. Aurora Cannabis is quickly turning into a major playing in the legal Marijuana space; the Company operates a 55,200 square foot, state-of-the-art production facility in Mountain View County, Alberta, and is currently constructing a second 800,000 square foot production facility, known as “Aurora Sky”, at the Edmonton International Airport, and has acquired, and is undertaking completion of, a third 40,000 square foot production facility in Pointe-Claire, Quebec, on Montreal’s West Island. The Company is led by Terry Booth, the youngest master electrician on record in Alberta (at 22) with a number of huger new projects underway at Aurora We will be updating on ACBFF when more details emerge so make sure you are subscribed to Microcapdaily so you know what’s going on with ACBFF.
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Disclosure: we hold no position in ACBFF either long or short and we have not been compensated for this article.