Will anything stop Aurora Cannabis (TSX:ACB)? The cannabis giant is stretching its footprint across South America, after Aurora Cannabis acquires ICC Labs. Announced today, Aurora has signed a deal with ICC Labs Inc. (TSXV:ICC).
The deal is reportedly worth $290 million and will see Aurora completely acquire all of the Uruguayan company's stocks.
Aurora Cannabis Acquires ICC Labs
The acquisition will now give Aurora the majority share of the Uruguay market. ICC has over 70% market dominance in the country where cannabis is legal for adult recreational use. Akin to this, ICC also has production licenses in Columbia for medical cannabis. The acquisition will make Aurora the industry leader not only in Uruguay but in South America as a whole—a continent that is home to over 420 million people.
ICC shares are reacting well to the news. At the time of writing, the stock is up nearly 3% and selling at $1.84 per share.
Regarding the deal, CEO of Aurora Terry Booth said the following:
"ICC and its management team have shown exceptional vision and execution across production, expansion, distribution and product development. The company has a very strong management team with deep connections throughout the continent, which we believe will facilitate successful expansion into all South American markets."
Who is ICC Labs?
ICC is a fully licensed producer and distributor of medicinal cannabinoid extracts, recreational cannabis, and industrial hemp products in Uruguay. It is a fully-licensed medical cannabis producer in Colombia.
>> Altria Group Hints at Involvement in Marijuana Industry
Approval
The transaction is still waiting for approval. It must get the green lights from the courts and receive a two-thirds majority vote by ICC shareholders. At present, Union Group International Holdings Ltd., which holds 29% stake in ICC, is in support of the deal.
Once approved, Aurora will be set to expand into South America leveraging ICC's popular brand. The transaction will bring with it low-cost production capacity, a unique product portfolio, and extensive distribution channels across South America and internationally.
Featured Image: Deposit Photos/pichetw
