One by one, Canadian cannabis companies have made headlines as they have signed significant partnership deals with large U.S. companies that specialize in other fields like beverages, tobacco and pharmaceuticals. But two major pot firms have so far resisted this trend – Aurora Cannabis Inc (TO:ACB) and Aphria Inc (TO:APHA).
In the last year, Canopy Growth Corp (TO:WEED), Tilray Inc (NASDAQ:TLRY) and Cronos Group Inc (NASDAQ:CRON) have all inked major partnering deals with American firms.
But that could soon change for Aurora, according to its chairman, Michael Singer.
In an interview with BNN Bloomberg last Friday, Singer said discussions with potential partners are taking place. But he refused to offer any specifics, except to say an announcement could be made in the next six months.
Singer also refused to shed any light on a previously announced courtship between Aurora and Coca-Cola (NYSE:KO), which made headlines last year. No deal, however, was ever announced.
But potential partnerships were not the only item of interest that surfaced during Singer’s interview with BNN. He also mentioned Aurora’s march toward profitability. He said the company is slated to turn that corner this quarter, adding: “We believe that’s a potential opportunity for us to bring in a traditional bond or that type of capital-raise … to finance the growth of our business.”
A bond issue could remove pressure to rush into a partnership deal, as a need for a cash infusion would be less acute.
When you consider these latest statements in light of the emerging backdrop that includes last month’s announcement that Aurora has hired Nelson Peltz, a U.S. billionaire investor who is founding partner of a multi-billion-dollar investment management firm, Trian Fund Management, the Canadian cannabis company is making unique strides.
Peltz is also the non-executive chairman of The Wendy’s Company and director of Procter & Gamble, and is a former director of the H.J. Heinz Company. And, according to Singer’s interview last Friday, one of the aspects that convinced Peltz to take on the role of strategic adviser with Aurora was that the company did not have any major partnerships. But Peltz could change that.
Aurora’s stock jumped more than 13 percent when Peltz’s hiring was announced. His deal with the company gave him the option to buy 20 million common shares, a move that could make him Aurora’s second-largest stock holder.
In a statement issued outlining Peltz’s appointment, Aurora said he would explore potential partnerships and serve as an adviser in its continued global expansion.
And that global expansion took another step last Friday, as it – along with Aphria – were among the companies chosen by the German government to be licensed to cultivate and distribute medical marijuana. Germany is the largest cannabis market in Europe to date.
Aurora stock closed last Friday at $12.28 a share. It started 2019 at $7.08. Overall, shares have gained 57.44 percent in the last year. It’s next earnings report is scheduled for May 7.
