Once the government approvals are materialized, Aurora Cannabis Inc. (TSX:ACB) will have a strong retail footprint
SmallCapPower | August 22, 2018: Aurora Cannabis Inc. (TSX:ACB), along with its wholly-owned subsidiary MedReleaf, Tuesday announced that it has entered into supply agreement with the Ontario Cannabis Stores. Ontario Cannabis Stores will be Ontario’s only online retailer when recreational marijuana is legalized in the fall. Aurora Cannabis and MedReleaf will supply a broad range of dried flower and higher-margin products, such as pre-rolls, oils and capsules.
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Aurora Cannabis, through its strategic investment in Alcanna, will also become a strong brand for cannabis in Western Canada and Alaska. Alcanna, the former beverage alcohol retailer, owns and operates 230 retail outlets in Western Canada and Alaska. Once the government approvals are materialized, Aurora Cannabis will have a strong retail footprint. Both the companies, Aurora and Alcanna, have entered into an agreement governing the branding and operational aspects of the new cannabis stores. Alcanna will be responsible for a fully immersive, state-of-the-art stores experience and imparting educational brand experience. Highly-trained Category Specialists will engage new and experienced customers with superior product knowledge and socially-responsible advice.
Aurora Cannabis, through its wholly-owned subsidiaries and strategic partners, have four production facilities and 29 patient education and counseling rooms in the province, making it one of the largest employers in the cannabis industry in Ontario, with more than 400 employees.
Aurora Cannabis CEO Terry Booth said, “We are proud of the strong relationships we have built with provinces across the country. Our supply agreements with the Ontario Cannabis Stores are evidence of our commitment to working closely with them to deliver the products consumers want to buy, including those under the Aurora brand, San Raphael ’71 and AltaVie. With a population of more than 14 million people, Ontario is the largest adult consumer use market in Canada. Being a supplier to this market though the Aurora and MedReleaf brands provides us with a strong presence that positions us well to generate growth and build further brand recognition. We look forward to making our high-quality products available to the Ontario market, and to initiating a meaningful educational conversation about our products and the appropriate use of them.”
As well, on August 20, 2018, Aurora Cannabis announced that it has set Friday August 24, 2018 as the record date for the distribution of the spin-out of its subsidiary Australis Capital Inc. The distribution will be paid on the basis of one unit for every 34 Aurora shares outstanding on the record date. Australis will identify and invest in U.S. cannabis and real estate assets.
Aurora Cannabis stock trades at market capitalization of C$7.8 billion with price to book multiple of 3.54x.
Disclosure: Neither the author nor his family own shares in the company mentioned above.
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