Aurora Cannabis has entered into an agreement to invest in Netherlands-based Growery B.V. one of the selected participants in the Controlled Cannabis Supply Chain Experiment (the “CCSC”).
"Aurora’s investment in Growery is structured such that the Company intends to invest an immaterial cash amount of which a portion is due and payable upfront, and the remainder dependent on Growery achieving certain milestones," the Aurora team explains. "Under the terms, Aurora will provide a secured loan to Growery to construct a facility, fund early operations and provide technical and operational support through its Netherlands-based state-of-the-art research facility for medical cannabis established in 2018. Aurora expects to fully consolidate the revenues realized through the investment into Growery under the applicable International Financial Reporting standards."
“Our investment in Growery is a significant advancement for our global recreational cannabis strategy. The Netherlands is expected to be the largest federally regulated recreational market outside of Canada, and is a proof point that our medical market success in Europe is portable to recreational markets,” said Miguel Martin, Chief Executive Officer of Aurora Cannabis.
“The shared expertise of Growery and Aurora will enable the delivery of high-quality cannabis to the new recreational program in the Netherlands,” declared a spokesperson from Growery. “We aspire to be a driving force in this evolving market and a premier provider of cannabis to consumers. In Aurora, we have found an experienced partner with the global leadership needed to enable a significant head start in the CCSC.”
The CCSC is scheduled to be in effect for a minimum of four years, during which the Dutch government will evaluate if the rules of the CCSC should be expanded nationally. Anticipated demand during the CCSC is approximately 30,000 kilograms of dried flower annually. Should the CCSC be expanded nationally (from approximately 80 coffee shops in 10 selected municipalities to the nearly 600 coffee shops that exist today), it is estimated that the Netherlands would require approximately 200,000 kilograms of dried flower annually to fulfill demand.
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