Organigram Enters the Race for Aurora Cannabis

The Battle for Aurora Cannabis is becoming increasingly complex. While Curaleaf Launches a Hostile Takeover Bid for the Canadian Producer In the medical cannabis market, another competitor may be preparing to enter the race: Organigram, backed by the tobacco giant British American Tobacco (BAT). A

According to information published by Cultivated, Organigram is reported to have held preliminary discussions with Aurora regarding a potential merger. Although no formal offer has yet been made, these talks add a new dimension to this battle.

Curaleaf Raises Its Offer in the Face of Resistance from Aurora

It all began in August, when Curaleaf Holdings proposed to acquire Aurora for approximately $272 million, offering $4 per share in a combination of cash and stock.

The board of directors of’Aurora rejected this proposal, which prompted Curaleaf to try again on October 5 with an improved offer of $5 per share, representing an increase of 25%. The offer remains valid until December 4, 2026.

Relations between the two companies have deteriorated, however, with Curaleaf accusing Aurora of denying it access to the usual audits while, according to some reports, maintaining contact with Organigram.

«We are outraged, and Aurora's shareholders should be too.»

Aurora's board of directors has advised shareholders to take no action while a special committee evaluates the revised proposal.

British American Tobacco could tip the scales

Organigram's potential involvement raises questions about the role of British American Tobacco, which initially invested 221 million Canadian dollars in the Canadian producer in 2021, thereby acquiring a 19.9% stake.

BAT has and subsequently committed to investing an additional 124.6 million Canadian dollars in 2023, thereby strengthening its relationship with Organigram and supporting its international expansion initiatives. The tobacco group now owns nearly 30% of Organigram.

The Cannabis Industry Analyst Pablo Zuanic, as reported by Cultivated, estimates that Organigram could offer approximately 8.55 Canadian dollars (6 U.S. dollars) per Aurora share, along with a few challenges.

Since Organigram’s market capitalization is significantly lower than Aurora’s, a stock-for-stock transaction could allow Aurora’s current investors to control approximately 51% of the combined entity.

According to Mr. Zuanic's calculations, a an additional investment of 60 million Canadian dollars from BAT could help make a competing proposal viable.

European Assets in the Crosshairs

Beyond the financial maneuvers, it is Aurora's international infrastructure that is its main draw. The company controls more than 50 metric tons of annual cultivation and manufacturing capacity, EU-GMP certified, giving it access to European medical cannabis markets.

These facilities are particularly valuable given that the German market continues to grow, particularly since 2024 and the removal of cannabis from the Narcotics Act so that it would be regulated by a dedicated law, the Medizinal-Cannabisgesetz (MedCanG).

For Organigram, the acquisition of Aurora could complement its international strategy, particularly its recent acquisition of the German cannabis distributor Sanity Group.

For Curaleaf, this transaction would strengthen its existing multinational platform. The company believes that a combined Curaleaf-Aurora entity would have a presence in 17 countries, generating more than $1.5 billion in annual revenue and nearly $350 million in adjusted earnings.

A Crucial Test for the Consolidation of the Cannabis Industry

The arrival of Organigram could force Curaleaf to improve its offer once again. Mr. Zuanic believes that Curaleaf has the flexibility to increase the cash portion of its offer without creating excessive financial pressure.

Organigram reportedly has not announced a firm offer, and discussions with Aurora may ultimately not result in a deal.

For now, this battle highlights the growing appeal of the European medical cannabis market, while France is slow to seize an economic opportunity that is driven by very real demand from patients seeking appropriate therapeutic solutions.