This past April, Aurora Cannabis (TSE: ACB) announced that it would try to acquire 100% of Hempco Food and Fiber. The cannabis company already controlled about 52%, so grabbing the remaining portion didn’t seem like too much of a stretch. It would appear that the deal is one step closer to being consummated, as Hempco shareholders have now been told that it would be in their best interest to approve the transaction.
Aurora is ready to spend $47.22 million to purchase the outstanding shares in the company, at a price of $0.77 each and payable in Aurora shares at a deemed value of just over $9.01. Anyone would say that this is a good deal, but an independent proxy advisory firm, Institutional Shareholder Services, Inc., has added its take and gives the deal its support.
Aurora CEO Terry Booth has said about the arrangement, “This transaction will enable us to fully integrate Hempco and its new Nisku processing facility into Aurora’s global hemp operations including Agropro, Borela and ICC. Our goal is to strengthen our CBD-from-hemp supply chain as well as our hemp business of hemp-based superfoods, nutraceuticals and fibers. With vertical integration, product innovation expertise, and global reach, we are well-positioned to extend our market share in these potential multibillion-dollar industries.”
The purchase had expected to be consummated before the end of the second quarter of the year, but additional time was needed to finalize all the details. The deal is expected to be decided on August 13 at 9 AM Vancouver time. Shareholders can now vote and must voice their position by August 9 at 9 AM Vancouver time. Those votes can be made via the Internet, by phone or fax and instructions for casting the vote can be found on the shareholder’s voting form.