Aurora Cannabis Inc. announced on Monday that it is taking steps to shore up liquidity and regain compliance with New York Stock Exchange requirements after its stock traded at less than $1 for more than 30 days.
The plan includes a 1-for-12 stock split which will see the company consolidate all of its outstanding common shares on the basis of one common share for every 12 common shares currently outstanding. That consolidation is expected to take effect on or about May 11.
Aurora said it currently has 1,313,494,990 common shares outstanding and, “assuming no additional common shares are issued prior to the consolidation,” the action will reduce the issued and outstanding common shares to about 109,457,915.
“The company expects the consolidation to restore compliance with the NYSE’s continued listing standards, and to provide access to a broad universe of investors, access to equity capital and trading liquidity.” – Aurora in a press release
The Canadian cannabis firm said it had $205 million in cash at the end of March, including all amounts raised in an at-the-market (ATM) offering program announced last May. The company is planning a new ATM program to raise additional equity capital on top of the roughly $350 million that remains available under its outstanding shelf prospectus. The firm indicated it plans to use a portion of those funds “to provide further balance sheet strength and preserve flexibility given macroeconomic uncertainty caused by COVID-19.”
Michael Singer, executive chairman and interim CEO, said the plans “are the appropriate actions” for the company to strengthen their cash position and “maintain financial flexibility.”
Aurora said that on April 8 they received notification from the NYSE that, as a result of its common share price falling below an average of $1.00 for a consecutive 30 trading-day period, it was not in compliance with one of the NYSE’s continued listing standards. That lack of compliance with the NYSE did not affect the company’s status on the Toronto Stock Exchange.
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