Shares of Aurora Cannabis Inc. ACB plummeted Monday after the Edmonton, Canada-based company announced that it will renew its at-the-market offering of up to $350 million in stock and complete a board-approved 1-for-12 reverse stock split.
The main objective of the latter move is to drive the share price above $1, which is a requirement to remain listed on the New York Stock Exchange.
The reverse stock split is scheduled for May 11.
Aurora said the moves will improve liquidity and help strengthen the balance sheet.
The company “intends to use a portion of this available capacity to provide further balance sheet strength and preserve flexibility given macroeconomic uncertainty caused by COVID-19,” according to Aurora.
The cannabis company also said it “remains on track with its previously announced business transformation targets, including: (1) material selling, general and administrative cost reductions; (2) significant reductions in capital expenditures; and (3) reducing complexity across the organization.”
Aurora shares were down 14.16% at 75 cents at the time of publication Monday.
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