Aurora Cannabis Inc. (“Aurora“) (ACB.TO) (ACBFF) ( Frankfurt : 21P; WKN: A1C4WM) and CanniMed Therapeutics Inc. (“CanniMed“) (CMED.TO) today announced the filing of Aurora’s Notice of Variation and CanniMed’s Notice of Change to Directors’ Circular (collectively the “Offer Documents“) in connection with Aurora’s improved offer to acquire all of the outstanding common shares of CanniMed (“CanniMed Shares“) not already owned by Aurora or its affiliates, described under “Aurora’s Notice of Variation” below (the “Improved Offer“). As previously announced by the parties on January 24, 2018 , CanniMed’s board of directors (the “CanniMed Board“) is unanimously recommending that CanniMed’s shareholders accept the Improved Offer.
Aurora’s Notice of Variation
Pursuant to the terms of the Notice of Variation, Aurora has increased the consideration offered per CanniMed Share, at the election of each CanniMed shareholder, to: (a) 3.40 common shares (“Aurora Shares“) of Aurora (the “Share Alternative“); (b) $43.00 in cash (subject to proration); (the “Cash Alternative“); or (c) any combination thereof (subject to proration of the cash portion), (the “Share and Cash Alternative“).
The maximum amount of cash available under the Improved Offer is $140 million (the “Maximum Cash Consideration“), and the number of Aurora Shares to be issued will be between approximately 72 million (assuming full cash elections) and 84 million (assuming full share elections and no cash elections). CanniMed Shareholders should note that any cash elected to be received is valued (for purposes of determining the number of Aurora Shares to be received in addition to such cash) based on an implied Aurora Share price of $12.65 , which may be more or less than the value of the share consideration at the time that the CanniMed Shares are taken-up under the Offer. CanniMed Shareholders are advised to consider recent market price quotations for Aurora Shares and to carefully review the Offer Documents before deciding whether to tender to the Improved Offer and before making their consideration elections.
The cash consideration of the Cash Alternative and the Share and Cash Alternative will be prorated, to ensure that the Maximum Cash Consideration payable is not exceeded. Assuming that all CanniMed Shareholders elect the Cash Alternative, each CanniMed Shareholder would receive $5.70 in cash and 2.9493 Aurora Shares for each CanniMed Share. The full details of the proration mechanisms are provided in Aurora’s Notice of Variation.
The Improved Offer is open until 11:59 PM (Pacific Time) on March 9, 2018 , subject to acceleration, extension or withdrawal by Aurora.
CanniMed Notice of Change to Directors’ Circular
The CanniMed Board has filed a Notice of Change to Directors’ Circular in connection with the Improved Offer. The CanniMed Board is unanimously recommending that CanniMed Shareholders accept the Improved Offer and tender their CanniMed Shares to the Improved Offer.
This decision follows a unanimous determination, made by the CanniMed Board and the special committee to the CanniMed Board (the “Special Committee“) that, after consultation with their financial and legal advisors, the consideration under the Improved Offer is fair, from a financial point of view, to CanniMed Shareholders (other than Aurora and its affiliates) and that it would be in the best interests of CanniMed to support and facilitate the Improved Offer. The CanniMed Board’s financial advisor, AltaCorp Capital Inc., and the financial advisor to the Special Committee, Cormark Securities Inc., have each provided opinions that, as of January 26, 2018 , and subject to the assumptions, limitations and qualifications on which the opinions are based, the consideration to be received under the Improved Offer is fair, from a financial point of view, to CanniMed Shareholders other than Aurora and its affiliates.
Initial Deposit Period
In connection with the filing of the Offer Documents, the CanniMed Board has reduced the initial deposit period (being the minimum amount of time the Improved Offer must be open for acceptance before Aurora can begin taking up shares under the Improved Offer) to 84 days from the commencement of the offer on November 24, 2017 . This means that commencing on the later of February 16, 2018 and the date all of the conditions to the Improved Offer have been satisfied or waived, Aurora will be able to take up CanniMed Shares under the Improved Offer. This news release is a considered a “deposit period news release” for the purposes of National Instrument 62-104 “Take-over Bids and Issuer Bids”.