Aurora Cannabis' stock surged almost 14% Wednesday after the company said that Nelson Peltz, a billionaire activist investor and a founding partner of hedge-fund Trian Fund Management, would become a strategic investor and advisor at the company. (ACB.TO, ACB.N) as a strategic advisor and is receiving stock options that could make him the pot firm's second-largest shareholder.
Peltz is the CEO and a founding partner of Trian Fund Management.
Nelson Peltz, seen here at the WSJD Live conference in Laguna Beach, Calif. on October 25, 2016, is joining Aurora Cannabis as a strategic adviser.
In exchange, the Edmonton, Alberta-based company will grant Peltz options to purchase nearly 20 million shares in the company at 10.34 Canadian dollars ($7.73) apiece - making him the second-largest shareholder, if exercised.
This equates to a almost 2 percent stake in the company, which would be vested every quarter over a four-year period, Aurora said. Peltz would become the cannabis company's second-largest shareholder if he exercises all the options. "Peltz should support in ensuring assets are kept that yield most value", Bennett said. "I look forward to helping Terry and the extended Aurora team evaluate its many operational and strategic opportunities, including potential engagement with mature players in consumer and other market segments".
Aurora chairman Michael Singer told CNBC Wednesday that the company is looking to sell "consumer package goods", as well as weedy beverages, cosmetics, and pharmaceuticals.
Aurora, based in Edmonton, Alberta, hasn't yet secured a major strategic partner along the lines of Constellation Brands Inc.'s investment in Canopy Growth Corp. or Altria Group Inc.'s deal with Cronos Group Inc.
Martha Stewart and Snoop Dogg's growing friendship has led them to partner on hit shows, books and products. - Peltz is arguably the highest-profile investor to take a job with a pot firm. "We believe he could be instrumental in facilitating discussions with large CPG companies".
Peltz has a long history of agitating for changes in the consumer space, including at Wendy's Co., where he is chairman. Trian also has pushed for changes at Procter & Gamble Co., where Peltz sits on the board; PepsiCo Inc.; Mondelez International Inc.; and Family Dollar Stores Inc.