Folium Biosciences takes over firm with Aurora ties
By COLLIN GALLANT on January 15, 2020.
cgallant@medicinehatnews.com@CollinGallant A complex arm’s-length relationship between two companies with major projects in Medicine Hat has been simplified. Folium Biosciences has taken over a U.S.-based capital investment firm related to Aurora Cannabis. Australis Capital, which held an investment stake in Colorado-based Folium, will be rebranded as Folium following a reverse takeover that was announced in late 2019 and is still pending regulatory approval. As a publicly traded company, the new entity will retain Australis’ listing on the Canadian Securities Exchange, while operations, including a proposal to build an expansion plant in Medicine Hat, becomes a wholly owned subsidiary of the new company. “Our plans continue to remain the same,” said Ryan Jackson, the Medicine Hat-based general manager of Folium’s Canadian interests. “We’re very excited about becoming a public (share trading) company – one that has access to capital markets to fund expansion.” Terms of the deal, announced on Dec. 11, were not disclosed but will result in principles of Folium controlling 89 per cent of the new company. Australis was created to house Aurora’s U.S. investments in the sector, that is operating in a still-evolving regulatory regime in the U.S. While cannabis is legal at the state-level in some jurisdictions, it is still a federally restricted narcotic. That presents some difficulties with federal financial regulators who oversee stock listings and financial reporting requirements of major publicly traded companies. Aurora has moved to trim its portfolio in an effort to rein in costs and preserve capital after releasing disappointing revenue figures in late November. It announced it would open only part of the Aurora Sun greenhouse in Medicine Hat this year, while delaying full commissioning until demand in the Canadian recreational consumption market grew. At the same time it noted that its medical lines were performing well. Folium, which supplies to cosmetic, health and food companies on a wholesale basis, says the outlook for its product is strong. “We’re an industrial hemp company,” said Jackson. Folium claims to process to extract near-pure CBD oil from hemp that is free from psychoactive TCH, which is common in cannabis. The company announced in early 2019 that it planned to build a major extraction facility here where a 200,000-square foot plant could employ 200 workers. That proposal to build in the Box Springs Business Park has move “slower than expected,” said Jackson. He told the News on Tuesday that an interim operating facility has been leased, equipment has been ordered and the operation could be up and running this spring, while work on the larger facility is commenced. Previous to the merger, Australis also planned to build a 220,000 square-foot manufacturing and packaging facility in Las Vegas, owned several product lines, patents on several extraction processes, distribution wings and was developing an automated kiosk system known as Cocoon. 20-19
