Aurora Cannabis US entity: A lot has happened in the Canadian cannabis sector this week. In fact, that might even be a bit of an understatement. Yesterday, the Senate passed the Cannabis Act, which means recreational cannabis use is now legal in Canada - come September, that is.
That's not all, though. Today, June 20th, Aurora Cannabis announced that it is planning to roll out its subsidiary as a separate entity. So, not only do we have cannabis legalization news, but we also have Aurora news. I'd say that's a good week for Canadian cannabis!
Aurora Cannabis US Entity: Spinning Off US Assets to Australis Capital
On Wednesday, Aurora Cannabis, a Canadian owned and operated company, announced that it is going to be moving and placing its US assets into a brand new, entirely separate company. The cannabis producer will spin off Australis Capital, its subsidiary. As a separate entity, Australis Capital will be investing in the cannabis sector, as well as the real-estate industry, in the United States.
Things to Know About the Aurora News
There's some important stuff to note about Aurora Cannabis' latest move. First, we have the question of how is this spinoff actually going to be achieved. Short answer: by scattering shares and warrants of the new entity.
If you're an Aurora shareholder that resides in Canada, you will receive shares of the new company at no cost. You will be able to continue to own shares in Aurora Cannabis, and own shares in the new entity. Win-win, right? That's probably why it's trending Aurora news.
Meanwhile, if you're an Aurora shareholder but you are not a Canadian resident, note that you will be given, according to media outlets, "cash, net of withholding taxes," rather than Australis equity.
Aurora Stock Price
So not only is news of Aurora Cannabis spinning out US assets trending, meaning the general public is optimistic, but investors also seem to be pleased with the news. How do I know that? Look at the stock on the market: it's sporting a bright green look!
According to Google Finance, at 2:52 p.m. EDT, Aurora Cannabis (TSX:ACB) was trading at $9.82 on the TSX. This means the stock was up 2.94% at the time.
Do you think it will be able to continue to climb before the closing bell rings?
Cannabis Community Thoughts
As mentioned, it seems the general public is optimistic about the Aurora news. One Twitter user even praised the fact that non-Canadian residents are going to benefit from Aurora Cannabis' decision.
https://twitter.com/petedoom/status/1009410755219873794
The Takeaway
What do you think of the new Aurora Cannabis US entity?
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Featured Image: CBC
