Canada's Aurora Cannabis Inc (TO:ACB) expanded its international footprint yesterday, announcing it is extending its operations into Portugal, making it the marijuana producer with the largest global footprint.
In a statement made public yesterday, the Edmonton-based firm announced it has acquired a 51-percent stake in Gaia Pharm, a medical cannabis and derivatives producer, and plans to build a cultivation facility that meets European Union standards.
According to the statement, the new facility will be built in phases, with the first phase completed in the latter half of 2020. It will produce approximately 2,000 kilograms of the weed per year. When the second and final phase of construction is completed, the Portugal facility will have an annual output of 4,000 kilograms per year. There was no date provided for completion of the second phase.
In reaction to the news, Aurora stocks gained 6.36 percent on the day.
But what does this mean when you take a step back and look at the global commercial marijuana market?
First, the move brings the number of countries Aurora now operates in to 24, which gives it the largest global footprint of any cannabis company.
Second, Aurora acquires Gaia’s approved permit to produce marijuana. This permit has been issued by the Portuguese Health Ministry.
And third, Portugal has one of the most producer-friendly regulatory approaches that favours domestic production within the Euro zone.
And lastly, last month, Portugal, which has a population of more than 10 million, approved laws to allow the distribution of medical marijuana. And these laws include the legalized export of cannabis to other countries in European Union where it is legal. This gives the company what CEO Terry Booth calls “distinct advantages in establishing significant market share in a rapidly growing European market.”
And that has the potential of being a game-changer in the ever-shifting landscape in the expanding cannabis sector.