James Alexander Michie: Aurora shareholders benefit and increase their capital | Seeking Alpha
Author: James Alexander Michie
It is well known that thanks to Aurora Cannabis (OTCQX:ACBFF) many investors have earned significant sums of money because they invested in shares and in fact many people expect that the one that is established as the third largest cannabis company in the world will go beyond the market capitalization, just behind Canopy and Tilray.
Now, it is well known that Aurora has just given a bonus to its shareholders and the value of the same increase more than 1,000% after gaining access to public markets.
On the other hand, Australis Capital is an investment company from Aurora that intends to acquire property interests in a variety of opportunities and asset classes, mainly in the cannabis and real estate sectors in the United States and due to the same each shareholder could receive shares or cash due to it, depending on whether they are Canadian or not. Added to this, it is necessary to mention that Australis today is established as a ghost company without real operative assets and in the same way its valuation of the public market is highly speculative.
Likewise, Aurora will not establish itself as the owner of any action in Australis after the IPO, which does not become a surprise for anyone because the main objective is to get rid of the assets of the United States in order to comply with the regulations of TSX. Despite this, Aurora has implemented a backup right under which it can acquire, up to 10 years after the IPO, 20% of the Australis shares at $ 0.20 per share and another 20% on the 5-day VWAP when the second endorsement in law is exercised. Aurora will not be able to exercise her right of backup unless the United States legalizes cannabis and the TSX approves it. From the IPO, Australis has shot up more than 10 times in relation to the round of financing prior to the IPO made at $ 0.20 per share. Australis has 113 million shares outstanding after the listing, which implies a surprising market capitalization of $ 270 million currently for a company that has no operating assets.
Similarly, it is necessary to mention that the idea of creating a ghost company in the United States and the idea of investing in cannabis assets in the United States was not something designed and executed for the first time by Aurora and it is also necessary to highlight that Australis must act quickly, intelligently and decisively.
Source: Seeking Alpha