Aurora Buys $45 Million Majority Stake In Bevo Farms

Bevo will take over the shuttered Aurora Sky facility as part of the completed deal.

Aurora Cannabis (Nasdaq: ACB, TSX: ACB) acquired a majority stake in grow giant Bevo Farms in a bid to consolidate and offload one of its largest greenhouses.

Aurora said it paid C$45 million (roughly US$35 million) for 50.1% of Bevo’s outstanding common shares. The company will take a controlling position on Bevo’s board of directors and financially consolidate the British Columbia-based veggie and ornamental plant supplier.

Bevo operates 63 acres of greenhouse in the province.

“The transaction allows Aurora to immediately benefit from a profitable, cash flow positive and growing business, and may have the potential to drive long term value to Aurora’s existing cannabis business via the application of Bevo’s industry leading plant propagation expertise,” Aurora said in a news release.

As part of the deal, $12 million could be paid to Bevo shareholders who sell their stake, conditional on certain financial targets being met.

“This investment once again demonstrates our disciplined capital allocation approach and is consistent with both our short term needs and long-term vision to be the leading global cannabis company,” Aurora CEO Miguel Martin said.

“Bevo’s track record in generating not only positive adjusted EBITDA but free cash flow, world-class propagation expertise and established distribution networks in Canada and the United States makes them an ideal strategic partner.”

At the same time, Bevo entered into an agreement to acquire the shuttered Aurora Sky greenhouse in Edmonton, Alberta, for up to C$25 million. 

Bevo’s management team will remain in place to pursue plans to repurpose the Aurora Sky facility for orchid cultivation and vegetable propagation. Aurora said it would keep all of Bevo’s facilities dedicated to its customer base and expand Bevo’s operations into Alberta through the addition of the facility.

Selling the greenhouse is expected to generate revenue and adjusted EBITDA “with minimal capital investment needed to retrofit the facility, while saving on facility shutdown costs,” the company said.

The deal comes as Canada’s legal cannabis industry – and North American legacy markets in general – reel over the oversupply of low-to-mid-grade flower.

“This is expected to allow Bevo to greatly increase its production capability, extend its shipping range and access new regional greenhouse demand in Canada and the United States,” the company said.

Up to $25 million could be payable over time by Bevo to Aurora in connection with the Sky facility deal, based on Bevo successfully achieving certain financial milestones at the facility.

The company said that the closing of the Aurora Sky transaction is conditional upon receipt of certain third-party consents.

“It is clear that the Aurora team is deeply aligned with our existing business plans and objectives for profitable growth, and we look forward to building upon the strengths of Aurora as a sponsor to accelerate our business,” Benne said.

Adam Jackson

Adam Jackson writes about the cannabis industry for the Green Market Report. He previously covered the Missouri Statehouse for the Columbia Missourian and has written for the Missouri Independent. He most recently covered retail, restaurants and other consumer companies for Bloomberg Business News. You can find him on Twitter at @adam_sjackson and email him at

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