Canada based Aurora Cannabis Inc. has announced its subsidiary acquired the remaining approximately 90% equity interest in Australia’s Indica Industries Pty Ltd (“MedReleaf Australia”).
Aurora has been on the cannabis scene for a long time. It began building its first facility in Western Canada back in 2013. The company was granted a federal licence to cultivate and sell medical cannabis in its home country in 2015. The first gram of Aurora’s licenced medical cannabis was sold the following year. In 2017, the firm listed on the Toronto Stock Exchange.
MedReleaf Australia is private company that has been operating in the Australian medical cannabis system since 2016. The company officially entered the local market on February 1, 2018 after securing the necessary cultivation, production and import licences from the Australian Federal Government’s Office of Drug Control (ODC).
The acquisition deal, worth AUD $50 million, is made up of AUD $9.45 million in cash, with common shares of Aurora making up the balance of the purchase price.
Commenting on the deal, Aurora stated:
“Since first partnering with MedReleaf Australia in 2017, Aurora has actively contributed to the region’s recent growth, leveraging the Company’s pharmaceutical grade cultivation and global approach to product innovation. The Transaction is expected to provide a meaningful platform for Aurora to continue growing its leading global medical cannabis position in Australia and other APAC countries.”
The company says the Australian market is currently estimated to be worth approximately AUD $400 million and has rapidly evolved into one of the largest nationally legal global medical cannabis markets outside of Canada.
Aurora CEO Miguel Martin said the transaction also presents an opportunity for Aurora’s plans to deliver positive free cash flow this year. MedReleaf Australia racked up trailing 12-month net revenue of ~AUD $40 million as of December 31, 2023 and was operating cash-flow positive.
The MedReleaf team are looking forward to the journey ahead.
“Aurora has been a true business ally of MedReleaf Australia and a trusted supplier since 2017,” said Medreleaf. “By combining our strong foothold in the fast-growing Australian market with their global expertise, we are opening the door for significant growth.”
