Aurora Cannabis Acquires C$26.5 Million Safari Facility and Faces 30% Veteran Rate Cut
ACB•Aurora Cannabis acquired Safari Flower Company for C$26.5 million, adding a 59,000 sq ft EU-GMP facility in Ontario and targeting positive adjusted EBITDA in FY27. A cut in veteran reimbursement from C$8.50 to C$6.00 will reduce related revenue by ~30% and push adjusted gross margins into the mid-to-high 50% range in FY27.
1. Safari Flower Acquisition Details
Aurora Cannabis paid C$26.5 million—C$15 million cash, 2.4 million shares and up to C$2 million contingent consideration—for Safari Flower Company in April, securing a 59,000 sq ft EU-GMP indoor cultivation and manufacturing facility in Ontario. This acquisition boosts Aurora’s in-house EU-GMP capacity, reduces third-party sourcing risk and underpins its Germany-led international growth strategy, with management forecasting positive adjusted EBITDA contribution in FY27 and incremental margin benefits in FY28.
2. Impact of Veteran Reimbursement Rate Cut
Effective April 1, veteran medical cannabis reimbursement dropped from C$8.50 to C$6.00 per gram, slicing reimbursement-related revenue by roughly 30% and exerting downward pressure on adjusted gross margins, expected to settle in the mid-to-high 50% range in FY27. Fixed production costs mean revenue declines flow directly to margins, although stable patient demand and expanding international sales are projected to partially offset the headwind.
