Aurora Cannabis taps billionaire investor Nelson Peltz as strategic adviser; shares jump

Marijuana company hires billionaire snack food tycoon Nelson Peltz

Marijuana company hires billionaire snack food tycoon Nelson Peltz

Nelson Peltz will join Aurora Cannabis as a strategic adviser to help the company lock in partnerships and expand internationally - a move seen as a major vote of confidence for the Canadian company and broader marijuana industry.

Peltz is the CEO and founder of New York's Trian Fund Management and serves on the board of The Wendy's Co., Procter & Gamble and Sysco Corp., among others.

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. "He isn't as antagonistic as some of the market may portray him to be and he collaborates closely with the company's board and management, and we thought that recipe and his deep connection to global businesses that we think are going to be value-added to our business going forward was the right recipe".

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.

The options granted to Peltz will become effective gradually over a four-year period on a quarterly basis, with accelerated vesting if specified events occur. If exercised in full, that would make Peltz the second-largest shareholder in Aurora after ETF provider Vanguard Group Inc., according to data compiled by Bloomberg. Aurora said in January that it expects to achieve sustained positive earnings before interest, taxes, depreciation and amortization beginning in the second quarter of 2019. "Peltz should support in ensuring assets are kept that yield most value", Bennett said. Pepsi's stock fell in 2016 when Peltz sold his shares in the beverage company. Rival companies Canopy Growth and Cronos Group also saw shares rise. Constellation and Altria both have the option of taking majority control of the Canadian cannabis companies in the future. Stewart discusses how cannabis has played a major role in their dynamic. Instead, it prefers to find multiple partners across various market segments, including packaged goods, beverages, cosmetics, wellness and pharmaceuticals. -Peltz is arguably the highest-profile investor to take a job at a pot firm. "We believe he could be instrumental in facilitating discussions with large CPG companies".