💸 The Tape

Two press releases, nine hours apart, and the gap between them tells you exactly where this deal stands.

At 7:05 a.m., Aurora Cannabis (TSX: ACB) (NASDAQ: ACB) issued a release headlined around correcting inaccurate statements. At 3:45 p.m., Curaleaf (TSX: CURA) (OTCQX: CURLF) fired back with a release accusing Aurora of deflecting from shareholder value creation.

Both companies now have proxy solicitors on retainer — Kingsdale for Aurora, Carson Proxy Advisors for Curaleaf. That's the tell. This is no longer a negotiation. It's a campaign.

Aurora's morning: four specific corrections

Miguel Martin's release did something more disciplined than the earlier statements. Rather than characterizing Curaleaf's motives, it went line-by-line at the bid circular's factual claims.

On German reimbursement. Curaleaf argued regulatory changes to German medical reimbursement pose a major challenge. Aurora's counter is a number: the reimbursement segment accounted for less than 10% of total German volume before those changes. If accurate, that guts one of the bid's central operating criticisms.

On international growth. Aurora cites 17% year-over-year international net revenue growth in fiscal Q1'27, with Germany a key driver.

On the UK and Poland. Aurora acquired Internode Pharma and HAP Pharma on August 19 to expand direct distribution, and claims the #1 market share position by revenue in Poland.

On cultivation. Aurora called Curaleaf's comments on cultivation methods and output per square foot inaccurate and outdated, noting it has increased EU-GMP production capacity by more than 40% over five years, including Safari Flower Company.

And it repeated the engagement claim: discussions since June, most recently August 12, involving both the Lead Independent Director and the CEO.

Curaleaf's afternoon: the sharpest response yet

Then Curaleaf did something Aurora likely didn't anticipate. It didn't dispute that conversations happened. It redefined what counts.

"We have not had a single conversation on the substance of a deal." Curaleaf says Aurora refused to sign an NDA and refused a site visit, and has posted the full correspondence at grow.curaleaf.com.

That reframing is effective, and here's why: it converts Aurora's strongest procedural defense into an admission. Yes, we talked. No, we never discussed price, structure, or diligence. If the correspondence supports that reading — and Curaleaf has published it — Aurora's "our door is always open" line becomes considerably harder to sustain.

Then Curaleaf pivoted to Aurora's own numbers, and this is where the exchange gets genuinely damaging.

On the 17% growth figure. Curaleaf argues the international business generated roughly C$5 million less revenue in June than three months earlier. June quarter adjusted EBITDA was 63% lower than March, and included approximately C$5.1 million of business transformation cost add-backs. Excluding those, Curaleaf says adjusted EBITDA would have been meaningfully negative, with cash flow from operations at negative C$4.4 million.

On cultivation. Curaleaf says the 114 grams per plant figure comes directly from Aurora's audited fiscal 2026 financial statements, and that Curaleaf's own yields are more than double it. The line that follows is the sharpest in the release: if there is better information available, shareholders deserve to see it.

On guidance. Curaleaf points to Aurora's own fiscal 2027 outlook — revenue approaching fiscal 2025 levels, adjusted gross margins falling from roughly 64% to the mid-to-high 50% range, and lower adjusted EBITDA.

On performance. More than C$400 million in inventory impairments and transformation costs under current leadership. Aurora shares down roughly 35% over the past year through August 10; Curaleaf shares up roughly 56%.

Where each side is actually strong

Aurora's advantage is asset scarcity. Curaleaf's entire strategic case rests on needing EU-GMP tonnage it can't build fast enough. That argument doesn't weaken with Aurora's EBITDA. The US$5.00 cap sitting below December 18, 2025 trading levels also remains unanswered — Curaleaf's afternoon release didn't address it.

Curaleaf's advantage is that it's arguing from Aurora's own filings. The 114 grams per plant figure, the guidance for lower margins, the transformation add-backs — these come from audited statements and Aurora's own outlook. Aurora called the cultivation data "outdated" without providing a current number, which is the weakest moment in its release.

And Curaleaf's closing observation carries weight: Aurora's share price rose materially after the offer and has traded near the implied value of the proposal. When a target's stock converges on the bid price, the market is pricing a deal, not a standalone turnaround.

Where this goes

The Directors' Circular is imminent. Due within 15 days of the August 19 launch — so by roughly September 3. That document must contain a formal recommendation, and it will be prepared by advisors who know every claim will be litigated in public. Expect Aurora to finally publish a current cultivation figure and a rebuttal to the transformation add-back math.

Then a 105-day war of attrition until at least December 1. Aurora will keep executing — the Internode and HAP acquisitions suggest more tuck-ins coming, each one arguably a defensive move to demonstrate the standalone plan works.

Watch for four things. A price increase from Curaleaf, most plausibly lifting the cap above the December 2025 level. A white knight — Tilray, Organigram and Village Farms all need the same assets. A shareholder-requisitioned meeting if institutions lose patience. Or rights plan litigation before Canadian securities commissions if Aurora deploys a poison pill.

The thing that would actually break the stalemate is an NDA. Curaleaf says it will meet anytime. Aurora says its door is open. Neither has signed the document that would let them find out whether the gap is C$1.00 or C$3.00 per share.

Until someone does, both companies are just arguing about last quarter's numbers in public — and shareholders are paying two proxy firms to watch.

📈 Dog Walkers

Cannabis Consumption Is Up, Why?

Gallup's annual Consumption Habits poll landed Monday, and the two headline numbers have finally crossed for good. 17% of American adults say they smoke marijuana — tying the record high — while cigarette smoking sits at a record-low 11%. Another 15% consume edibles, up from 12% in 2024.

The trajectory is the story. Marijuana smoking was 7% in 2013. Cigarettes were 45% in 1954 and 19% as recently as 2015.

The demographics explain most of the gap. Marijuana use concentrates in adults under 50 — 23% of 18-to-29s and 25% of 30-to-49s — collapsing to 5% among those 65 and older. That's a generational replacement effect, not a conversion. Cigarettes, meanwhile, peak among 30-to-49-year-olds at 16% while vaping peaks among the youngest cohort at 17%. Younger adults never picked up the habit their parents are aging out of.

Legal access clearly matters — you don't triple usage in thirteen years without supply — but two other findings suggest something broader. Consumption skews toward lower incomes (24% under $50k versus 13% above $100k), the less religious (22% among rare attendees, 4% among weekly), and correlates strongly with drinking. Notably, alcohol consumption just hit a record-low 54%. Substitution is real, though clearly incomplete: cannabis users are more likely to drink.

One caution for the bulls. Americans remain split on whether marijuana benefits users — 47% positive, 46% negative. Normalization of behavior isn't the same as normalization of opinion.

Record consumption, contracting legal revenue. The demand argument was settled some time ago. The capture argument wasn't.

📺 Trade To Black

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• The FDA is six months past a legal deadline. Congressional researchers are calling out the agency for failing to publish required lists of known cannabinoids and guidance on hemp product container definitions — a delay hemp industry leaders say makes compliance nearly impossible.

• Michigan's tax fight gets a candidate. GOP gubernatorial hopeful John James unveiled a platform pledging to repeal or sharply reduce the state's 24% wholesale cannabis tax, while cracking down on unregulated Delta-8 and THCA sales at gas stations and smoke shops.

• The rescheduling transcript gets corrected. DEA Chief ALJ Derek Julius ordered changes to the official hearing record, with the final version due August 26 — while DEA's own final brief argues marijuana no longer meets the legal criteria to remain in Schedule I.

• An unusual setup in MSOS options. Andrew O'Connell of the Pristine Capital Substack, a past U.S. Investing Championship participant, returns to break down open interest stacked at a single $5 strike — roughly 150,000 contracts, dwarfing every other level on the chain.