Aurora Cannabis closed its previously announced debt facility with the Bank of Montreal. The facility consists of a $150 million term loan and a $50 million revolving credit facility maturing in 2021.
Included in the facility is an option to upsize the facility to $250 million total following the implementation of Bill C-45 on October 17, 2018, subject to agreement by BMO and satisfaction of certain legal and business conditions.
The debt facility is primarily secured by Aurora’s production facilities, including Aurora Sky, Aurora Mountain and Aurora Vie. Strategically located at Edmonton International Airport, Aurora Sky is a technologically advanced cannabis facility, projected to produce in excess of 100,000 kg per year of high-quality, low-cost-per-gram cannabis upon completion.
Pursuant to the agreed upon conditions of the loans, Aurora may, at its discretion, repay the balance of the loans without penalty, at any time. The pricing of the loans is a set margin over the BMO CAD prime rate or a bankers’ acceptance of appropriate term. Based on the current prime rate, the interest payable is expected to be in the mid to high 4% per annum range over the term of the loans.
“We are incredibly proud to have successfully closed this historic debt facility supported by a premier Canadian bank, BMO, who understands our needs and potential. This is both a reflection of the rapidly maturing nature of the broader cannabis industry and strong validation of the economic potential of Aurora’s best-in-class, technologically advanced production facilities,” said Terry Booth, CEO of Aurora.