Aurora Cannabis announced that a wholly-owned subsidiary of the company has acquired the remaining approximately 90% equity interest of Indica Industries Pty Ltd (MedReleaf Australia) that Aurora did not previously own, at an enterprise value of AUD$50 million, subject to customary adjustments. Aurora paid AUD$9.45 million in cash, with the balance of the purchase price satisfied by the issuance of common shares of Aurora.
MedReleaf Australia is a distributor of medical cannabis products and holds the #2 position in the Australian medical cannabis market. This market is currently estimated to be worth approximately AUD $400 million and has quickly become one of the largest nationally legal global medical cannabis markets outside of Canada.
The medical cannabis market in Australia is characterized by a clinician-led traditional pharma-like product distribution model that aligns with Aurora's operational success in other key global medical cannabis markets, such as Germany. 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 global medical cannabis position in Australia and other APAC countries.
"The acquisition of MedReleaf Australia represents a strategic milestone in Aurora's global cannabis leadership, demonstrating our commitment to investing in markets that offer opportunities for sustainable and profitable growth, said Miguel Martin, Chief Executive Officer of Aurora. "We are excited to solidify our position in this rapidly growing market and the opportunity this transaction presents to us in accelerating our plans to deliver positive free cash flow in calendar 2024," added Mr. Martin.
"We're proud to have built one of Australia's leading medical cannabis companies, thanks to our main supplier, Aurora, dedicated investors, and dynamic team. Through our vision, we've connected clinicians with patients nationwide, positively impacting thousands of lives. This transaction marks an important step for MedReleaf Australia's ongoing growth, as we believe medical cannabis is now mainstream medicine, and we're grateful to be part of that story," said Russell Harding and Nathan Davis, Co-founders of MedReleaf Australia.
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