Aurora moves ahead with merger plans for CanniMed

Aurora Cannabis Inc. says its $1.1 billion bid to acquire CanniMed Therapeutics Inc. has been successful, and it will formally buy up the smaller company’s shares “as soon as possible.”

The Edmonton-based company’s announcement comes about three months after it launched an acrimonious hostile takeover bid for the firm, which is based in Saskatoon. Both companies agreed on a friendly takeover in January.

“Following the take up, we will immediately commence with the integration of CanniMed into the Aurora organization and start executing on realizing the strategic synergies we have identified,” Aurora CEO Terry Booth said Friday in a statement.

The merger will form a “company that is exceptionally well positioned to capitalize on the tremendous opportunities in the domestic and international medical markets, as well as the Canadian adult consumer use market, once legalized,” Booth added.

Founded in 1998, CanniMed is Canada’s first licensed medical marijuana producer. It employs around 200 people at its facility southeast of Saskatoon, which is in the midst of a $10.5 million expansion aimed at boosting cannabinoid oil production.

Aurora said 17.8 million CanniMed shares, or about 71 per cent of the total, have been tendered under the agreement. It will trade those for 50.6 million of its own shares — which closed Thursday at $11.50 — plus $98 million in cash.

The larger company has said previously that CanniMed will be the “cornerstone” of its new medical cannabis “centre of excellence,” a corporate group expected to have 40,000 patients and produce 260,000 kilograms every year.