Canadian Cannabis Giant Takes Strategic Steps To Reduce Debt & Boost Financial Stability

Aurora Cannabis Inc. ACB ACB has received approval to transfer the listing of its common shares from the Nasdaq Global Select Market to the Nasdaq Capital Market. The transfer became effective at the business opening on Tuesday, Sept. 19 and is expected to allow the company to seek an additional 180 days to regain compliance with the Nasdaq Listing Rule 5450(a)(1).

The shares continue to trade in the United States under the symbol "ACB," and the trading of the shares will not be affected by the transfer.

In connection with the transfer, Aurora has applied for, and expects to receive, an additional 180 calendar day period in which to regain compliance with the Minimum Bid Price Requirement.

Aurora To Repurchase Additional Shares

The Canadian cannabis giant simultaneously announced that it has agreed to repurchase an aggregate of roughly CA$13 million ($9.6 million) principal amount of its convertible senior notes at a total cost, including accrued interest, of CA$13 million satisfied by the issuance of an aggregate of approximately 13.5 million shares.

The news comes on the heels of Aurora's repurchase of an aggregate of roughly CA$12.3 million principal amount of its convertible senior notes in multiple transactions between Aug. 16 and Sept. 8, 2023.

Why It Matters?

The purpose of the notes repurchase transaction is to reduce further the company's debt and annual cash interest costs, reinforcing Aurora's commitment to achieving the target of positive free cash flow in 2024.

Aurora has repurchased an aggregate of approximately CA$428 million ($316 million) principal amount of notes since December 2021, resulting in total cash interest savings of roughly CA$32 million ($24.1 million).

After completing these repurchases, Aurora will have roughly CA$ 39.6 million ($29.2 million) of notes outstanding.

"With one of the strongest balance sheets of the Canadian LPs evidenced by our net cash position and continued commitment to prudent fiscal management, we are confident in our ability to achieve our target of positive free cash flow within the calendar year 2024," Aurora CEO Miguel Martin said earlier.

Martin, who was a featured speaker at April's Benzinga cannabis event in Miami, became Aurora's CEO in 2020. At the time, the company was reporting a net loss of CA$3.3 billion for its fiscal 2020. The only positive light at the end of the tunnel was the company's "transformation" plan that then-interim CEO Michael Singer undertook.

Benzinga Cannabis Capital Conference returns in Chicago this Sept. 27-28, gathering top executives, entrepreneurs and stakeholders.

ACB Price Action

Aurora's shares traded 1.97% higher at $0.88 per share during the pre-market session on Tuesday.

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