Aurora Cannabis Inc (NASDAQ:ACB) shares are booming Tuesday after the company agreed to be acquired by Organigram Global for 7.80 Canadian dollars ($5.57) per share, a deal that tops a rival hostile offer from Curaleaf. Here’s what you should know.
- Aurora Cannabis stock is surging to new heights today. Why is ACB stock up today?
Aurora Cannabis Stock Rises On Organigram Takeover Deal
Aurora Cannabis shares are rising after Organigram agreed to buy the company for C$7.80 a share, an equity value of about C$561 million. Aurora holders pick how they get paid. They can take all cash, take only Organigram stock at 5.8626 shares for each of their own, or split the payment between C$3.75 in cash and 3.0431 Organigram shares.
The price is 93% above Aurora’s price on Aug. 10, the final complete session before Curaleaf revealed its hostile plan, and 21% above Curaleaf’s current bid, which was last amended on Oct. 6. Aurora’s board unanimously rejected that bid. It now calls the Organigram deal better for shareholders and tells them not to tender to Curaleaf.
What the Combined Company Would Look Like
The two Canadian cannabis companies say they would run five sites with EU-GMP certification and hold leadership positions in Canada, Europe and Australia. They also count on more than C$50 million in synergies. After closing, Aurora holders would own about 35% of the combined economics and hold 42% of the votes. Organigram CEO James Yamanaka called the deal a “defining step” for the company’s strategy.
British American Tobacco, Organigram’s cornerstone shareholder, will buy about C$187.5 million of new Organigram shares at C$1.33 to help pay the cash portion.
Two-thirds of the votes cast by Aurora shareholders must back the deal, and so must a majority of the holders outside certain insiders. Organigram shareholders also vote, and British American Tobacco’s 30% of Organigram’s votes is committed in favor even though it sits outside that count.
Both meetings should happen in December, and court and regulatory approvals remain. The companies expect to finish in January 2027.
ACB Shares Are Flying
ACB Price Action: Aurora Cannabis shares were up 19.67% at $5.05 at the time of publication on Tuesday, according to Benzinga Pro.
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