Curaleaf’s $4-per-share cash-and-stock offer for Aurora Cannabis is open until Dec. 1, but Aurora recommends shareholders reject it. Curaleaf has also applied to Alberta’s Securities Commission to stop Aurora’s at-the-market share sales.
Aurora says the offer significantly undervalues it, pointing to its debt-free balance sheet versus Curaleaf’s $1 billion in debt. It also says Aurora shareholders would own 7.7% of the combined company but hold only 3.2% of its voting rights. Curaleaf says the bid benefits Aurora shareholders and argues that share sales below its offer price destroy value.
Aurora says the at-the-market plan predated Curaleaf’s bid and is used only when its board believes a sale will benefit shareholders; it cited its Safari Flower Company acquisition as an example of building long-term value. Aurora shares rose from just under $3 before the offer to roughly $4; the article says they could fall back toward pre-offer levels if the bid fails.
