Aurora Cannabis Inc.(NYSE: ACB) has signed a letter of intent to buy all of Mexico’s Farmacias Magistrales SA’s outstanding shares. This comes after the announcement of a supply deal between the two companies.
Farmacias imports raw materials that contain THC, the psychoactive ingredient in cannabis. It is Mexico’s first and only federally licensed importer of these raw materials at the moment, Aurora said in a statement. The Company holds the power to facilitate, store, and distribute medical products with more than 1% THC.
Farmacias has 80,000 retail outlets that sell CBD products and 500 pharmacies and hospitals to sell THC products. The Company will import THC and CBD concentrates to manufacture cannabis oil products for the medical market and intends to eventually expand out to capsules, topical solutions, and other uses for the product.
With the recent deal, Aurora creates a first-mover advantage in a country that has gained increased attention toward cannabis ideals. A statement said that the move “firmly establishes Aurora’s first-mover advantage in one of the world’s most populous countries, where more than 130 million people will have federally legal access to a range of Aurora’s non-flower medical cannabis products containing THC.” Aurora also operates in Colombia and Uruguay.
Aurora Chief Executive Terry Booth said, “integrating Farmacias with our operations in Canada and Latin America will not only accelerate growth, it will build substantial long-term shareholder value.” The acquisition deal generates hope that Aurora Cannabis trends up in the long run with the expansion of operations into another country.