Aurora Cannabis Inc has positioned itself over the past couple of months as one of the top cannabis companies in the market. Analysts have previously considered Canopy Growth Corp ) the top company in the sector, but that has recently shifted among recent news announcements and partnerships. Today Aurora announced that they were filing a preliminary shelf prospectus, opening up the possibility of raising as much as $750 million in additional funding.
Management staff went on to mention that while they were not necessarily going to raising these funds immediately, it was part of a wider strategic initiative as they keep their options open moving forward when it comes to global expansion. The Shelf Prospectus, when filed, will let Aurora raise up to $750 million in common shares, debt securities, or other securities
“Although we have no immediate intention of drawing capital against this Shelf Prospectus, we have introduced this option as a prudent and long-term strategic measure to provide us with flexibility in access to growth capital, if or when required, to continue executing on our global expansion and partnering strategy,” said Aurora executive chairman Michael Singer. “With our recent listing on the NYSE, our successful financing in January 2019 led by U.S. institutional investors, and as we work with Nelson Peltz to explore potential partnership opportunities, this filing is a natural evolution for our company as we rapidly mature into a global and profitable organization.”
Aurora Cannabis has been had a prolific expansion policy through a variety of all-stock mergers and acquisitions. These deals have often been criticized by investors, who see this dilution in stock as exerting a downward pressure on share prices.
Despite this, Aurora Cannabis outperformed its other major competition, Canopy Growth and Tilray Inc , companies with valuations well above Aurora’s. Despite having a lower market cap then some of these companies, Aurora has a much larger production capacity then more highly priced companies like Tilray, even eclipsing Canopy Growth in this regard.
Shares of Aurora tumbled just under two percent in response to the news but remain hopeful that the company will announce some major partnerships in the near future partially as a result from Aurora’s new relationship with Nelson Peltz, a billionaire who brings plenty of connections in the consumer-packaged-goods space. Word on the street is that Aurora might announce a partnership for a CBD-based product as mentioned by Barrons. Overall, out of the biggest cannabis players in the market, Aurora’s metrics and partnerships put it at a relative bargain in comparison to its rivals.
Aurora Cannabis Company Profile
Aurora Cannabis Inc is a Canada-based company engaged in the production and distribution of medical cannabis. The Company is vertically integrated and horizontally diversified across every key segment of the value chain, from facility engineering and design to cannabis breeding and genetics research, cannabis, and hemp production, derivatives, home cultivation, wholesale and retail distribution.
The Company’s purpose-built facilities which integrate technologies across all processes are defined by automation and customization. The Company has a funded capacity of more than 500,000 kilograms per year as well as sales and operations in 24 countries worldwide. – Warrior Trading News