Curaleaf Issues Fact Sheet to Address What It Believes Are Misleading Statements From Aurora

Curaleaf defended its acquisition proposal for Aurora Cannabis, arguing that its US$5.00 capped offer represents a 45% premium to Aurora's share price and a 110% premium excluding Aurora's cash balance. Curaleaf contrasted its $447 million of positive operating cash flow since FY2021 with Aurora's more than C$480 million of negative operating cash flow, approximately C$5 billion of impairments, and a 97% share-price decline under CEO Miguel Martin. Curaleaf also said Aurora's FY2027 guidance implies revenue falling back to FY2025 levels and lower adjusted EBITDA year over year, while positioning potential U.S. federal cannabis reform as a catalyst for lower taxes, stronger free cash flow, institutional ownership and exchange uplisting.

Analysis

This is primarily an escalation in a hostile-process negotiation, not new fundamental information. Curaleaf’s public focus on Aurora’s dilution, guidance trajectory and refusal to negotiate is designed to raise the cost of remaining independent for Aurora’s board and shareholders; that increases the probability of either a shortened timetable, a modest price/structure concession, or a formal defense built around a superior standalone valuation. The immediate asymmetry favors ACB if the market assigns a low closing probability, but the stock component means its ultimate value remains materially exposed to CURLF volatility.

For Curaleaf, a stock-funded acquisition is accretive only if acquired cash flow and overhead/cultivation rationalization exceed the effective dilution and incremental financing burden. The strategic value is less about Canadian revenue and more about consolidating medical/export infrastructure ahead of broader federal normalization; scaled operators such as GTBIF and TCNNF could benefit indirectly from a sector-wide reduction in perceived regulatory and financing risk, while smaller Canadian LPs face a tougher competitive environment if the combined entity rationalizes pricing and procurement.

The contrarian view is that the market may be over-crediting a transaction simply because Aurora’s standalone case appears weak. Aurora can use the bid to attract alternative strategic interest, seek a higher exchange collar, or run out the timetable; meanwhile, a delay exposes Curaleaf to any reversal in U.S. rescheduling expectations, which would pressure its equity consideration and financing multiple. The key 1-3 month catalyst is Aurora’s formal response and tender participation, while the 6-18 month value driver is regulatory implementation rather than announced synergy claims.

Key Decisions for Investors

• Establish a small merger-arbitrage position only after calculating the live implied consideration: long ACB / short the contractual CURLF share equivalent, sized for a 35-50% downside to ACB’s unaffected price if the offer fails. Do not initiate without the exact exchange ratio, collar mechanics, borrow availability and current spread; these determine whether the apparent premium is investable.
• For existing CURLF longs, retain exposure but hedge event risk through a partial ACB long or reduce gross into any bid-driven CURLF strength. A revised offer or prolonged hostile process can create incremental CURLF dilution before any synergy is realized; reassess if Curaleaf signals a cash increase, changes the cap/collar, or leverages the balance sheet further.
• Use GTBIF and TCNNF as cleaner 6-18 month regulatory-normalization exposures rather than treating this transaction as a broad Canadian LP buy signal. Prefer a long GTBIF or TCNNF versus short ACB pair if Aurora’s next guidance update confirms revenue/EBITDA deterioration without a superior bid.
• Set alerts for: Aurora board engagement with a confidentiality agreement, a competing bidder, tender levels, and any U.S. rescheduling implementation delay. A formal superior proposal invalidates the ACB short leg; a failed tender combined with continued equity issuance would favor re-establishing an ACB short after the deal break.