Dillution, is a fact of company issuing shares for operating expenses, in this case it's a merger.
There won't be a dillution, more shares will be issued and capital value of company will increase. So, currently 4.2bln, and it will be 7.6 bln, about the same as Canopy. It's the reason why Canopy is declining, because Aurora is bigger now.
Leaders in the industry get higher p/e and share price as result... soon will be back at $9. There's some selling by Medreleaf are going on Aurora side, it's a reason, why we can't push back above 50 days.
More Information about the Announcement here:
- Industry-leading scale: Funded capacity will increase to over 570,000 kg of high-quality cannabis per year, to be delivered through nine facilities in Canada and two in Europe
- Low production costs and industry-leading yields: Aurora's automated 'Sky Class' greenhouses are expected to deliver industry-leading efficiencies and ultra-low production costs of well below $1 per gram, delivering sustainably robust margins. MedReleaf's high-yield cultivation techniques are expected to further enhance productivity and reduce costs across the combined entity's facilities.
- International distribution: Aurora has established a strong and rapidly growing footprint in the international medical market. The combined entity is now well-positioned to rapidly gain market share in a number of significant markets. Most notable among these, is the European Union, which will have in excess of 400 million people following Brexit.
- Expanding brand leadership: Aurora, CanniMed and MedReleaf represent three well-established medical cannabis brands, and a growing portfolio of premium consumer and wellness brands including San Rafael '71, Woodstock, and AltaVie that are backed by detailed consumer and marketplace insights and advanced analytical frameworks. This brand leadership positions the combined entity well to drive accelerated growth through its existing distribution channels for the domestic medical and consumer markets, as well as the international medical markets.
- Scientific leadership: Each company is actively engaged in clinical trials and medical studies, which has resonated strongly with the international medical community, driving above-average prescription rates and referrals. Further, both companies have developed considerable expertise in cannabis plant genetics, enabling the development of new cultivars with specific traits for a variety of domestic and international markets, as well as strains optimized for automated cultivation.
- R&D: The combined company will have an industry leading Science and Research & Development team that includes approximately 40 PhDs and MScs. Both companies have a proven track record in developing new products, adopting new technology throughout the value chain, and integrating innovations from third parties. Combining these capabilities will accelerate product development and technology adoption, creating strong, defensible competitive advantages, including, management believes higher-margin offerings to drive above average profitability.
We are starting to see some major support around 6.8 - haven't supported around this area since december 2017. before news broke out about legalization in canada.
we will see this support for the majority of the year until development is completed an production can start up again on the new grow opts.
volume is looking