Yesterday, the Investment Industry Regulatory Organization of Canadad (IIROC) issued a trading halt for shares of both Aurora Cannabis Inc. (TSXV:ACB) (OTC:ACBFF) and Radient Technologies Inc. (TSXV:RTI). The halt notice stated that it was issued due to pending news. Trading in both companies on the TSX Ventures Exchange has since resumed, and we now know that an agreement was pending.
Earlier this morning, Aurora Cannabis and Radient Technologies announced a memorandum of understanding (MOU) to evaluate a joint venture to develop, produce and commercialize "superior and standardized cannabinoid extracts." In addition to the joint venture, as part of the MOU, there is also a financing agreement attached.
As part of the MOU between Aurora and Radient, Aurora Cannabis will invest up to $2,000,000 CAD in Radient Technologies through a convertible debenture. This is still subject to certain terms and conditions, however the deal has shares of RTI.V up over 100% in trading intraday. The deal is equivalent to roughly $1,518,487 USD at current FX rates.
The debenture will have a 2 year term, bearing interest at a rate of 10% per annum and will be convertible at a price of $0.14 CAD per unit of Radient. Each Radient unit will be one share of Radient Technologies common stock and one warrant exercisable within 2 years for one additional share of Radient at a price of $0.33 CAD.
Shares of Radient Technologies are currently trading at $0.31 CAD per share, down from today's high of $0.43 CAD per share.
Radient is currently operating a 20,000 square foot facility in Alberta, Canada which extracts natural ingredients and extracts for a variety of food, drink, pharma, and nutritional applications. Radient's extract technologies will be applicable to the cannabinoid extraction processes to "produce high-quality standardized extracts with faster throughputs, improved yields, higher purities, and lower costs when compared to conventional extraction methods."
Recent Aurora Cannabis Developments
This announcement follows another notable development for Aurora Cannabis in the recent weeks. On December 2nd, Aurora announced breaking ground on their massive new facility.
We want to remind investors and readers that the deal is still subject to regulator and exchange approval, and that the announcement stated that the companies will be evaluating the joint venture. We will be awaiting further announcements and details regarding the deal, but given the share price of RTI, it seems to be shaping up as a good deal for Aurora.
For more recent coverage and custom stock charts on Aurora Cannabis, be sure to check out the company's stock profile in our TSXV Listed Marijuana Stocks Database. Also, don't forget to connect with us on social media using the links to the right of this article. For the original release announcing the joint venture, click here.