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by Mike Caswell
Three shareholders of Aurora Cannabis Inc. have filed a shareholder oppression case in the Supreme Court of British Columbia over a $218-million undermarket offering. The shareholders claim to have suffered the loss of roughly half of the value of their shares as a result of the offering. They also say that there was no need for the company to raise money, as it had a healthy balance sheet.
The allegations are contained in a petition filed at the Vancouver courthouse on Friday, Nov. 25. The case was brought by Martin & Millen Inc., a private Ontario entity holding 676,436 shares, and DMMB (Pty) Holdings Ltd., a Bahamian entity that owns 261,096 shares. Also bringing the case is Chad Barrett, a Texas man who does not list the number of shares that he controls.
The petition arises from an offering that Aurora announced on May 26, 2022, in which it ultimately issued 70.4 million units at $3.13. The shareholders complain that the price was a significant discount. (The stock was above $5 in the weeks leading up to the offering, and was at $3.43 the day before the company issued the news release. In the days after Aurora announced the offering, the stock began falling, initially dropping to $2.14 and hitting $1.87 on June 9.)
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