The Globe and Mail reports in its Friday edition that investment banks are struggling to find buyers for Aurora Cannabis's stake in the Green Organic Dutchman, with roughly 40 per cent of the deal unsold. The Globe's Tim Kiladze and Mark Rendell write that late Tuesday, Aurora signed an agreement to unload its remaining equity stake in TGOD through a group of investment banks led by BMO Nesbitt Burns. The $86.5-million deal was priced at $3 a share -- a 14.5-per-cent discount to Green Organic's closing price of $3.51 on Tuesday. BMO structured the deal as a block trade. Typically this format is used when there is ample demand from investors, so the investment banks mostly serve as intermediaries that quickly match the buyers with the seller. However, many institutional buyers have balked at the Aurora stake, leaving the underwriters on the hook for any unsold stock. TGOD's shares closed at $2.94 on Thursday, slightly below the $3-per-share purchase price paid to Aurora. The lacklustre demand is further evidence that cannabis investors are demanding profits over expansion potential. The Horizons Marijuana Life Sciences Index ETF has fallen 39 per cent since recreational cannabis use was legalized in October.
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