EDMONTON and ANCASTER - Aurora Cannabis Inc. and The Green Organic Dutchman Holdings Ltd. today announced that the companies have completed a definitive agreement covering a strategic investment in TGOD by Aurora, as well as a supply contract.
By Justin Bellmore
Under the terms of the agreement, which the companies anticipate completing in the coming weeks, Aurora will acquire, through a private placement a 17.62% interest on a non-diluted basis.
The placement consists of 33,333,334 units, priced at $1.65 per unit, for gross proceeds of $55 million. Each unit consists of one common share and one half of one common share purchase warrant, exercisable at $3.00 per common share for a period of 36 months following closing of the offering.
Upon TGOD achieving certain corporate, operational, construction and financial milestones, as described below, Aurora shall have the option to incrementally increase its ownership interest in TGOD to 51%. The completion of the transaction is subject to customary closing conditions, as well as the entrance into an investor rights agreement.
TGOD will be constructing an ultra high-technology greenhouse facility, similar to the Aurora Sky facility, at Valleyfield in Quebec, where TGOD owns a 75-acre property.
The facility will measure 820,000 square feet, making it one of the world’s largest purpose-built cannabis facilities.
Management anticipates completion of the Valleyfield facility by the fourth calendar quarter of 2018.
The facility, when completed, will measure 150,000 square foot in total, with a production capacity of 14,000 kg of premium organic cannabis per annum.
TGOD will be outsourcing its power, heating, cooling and C02 production, and associated CapEx costs, via a scalable six-megawatt co-gen natural gas micro-grid power plant.
Csaba Reider, President of TGOD said that “with this significant cornerstone investor and customer, we will be able to leverage our deep consumer packaged goods and brand building experience, as well as Aurora`s well-established brand recognition, to pursue rapid growth.”
“…In return,” said Aurora Cannabis CEO Terry Booth, “…Aurora will secure a ready supply of high-quality organic cannabis products to serve our Canadian and international customers.