Agreement allows Alcanna to open retail stores branded Aurora

Licensed producer Aurora Cannabis will provide some but not all products in the stores

All cannabis stores in B.C. after October 17 must be licensed by the provincial government and municipalities | Deloitte Canada

A partnership between two Edmonton-based companies is likely to have an effect on B.C.’s future retail-cannabis sector.

Licensed producer Aurora Cannabis (TSX:ACB) has reached an agreement with Alcanna (TSX:CLIQ) to give Alcanna the exclusive right to build, own and operate retail stores branded Aurora Canadawide.

Alcanna, which recently changed its name from Liquor Stores NA, operates 229 retail outlets in Western Canada and Alaska and has extensive experience operating liquor stores.

The Aurora brand, however, is likely much better known and that was part of the rationale for the partnership, according to the companies.

The stores will be branded Aurora but will carry products from a wide range of producers, including MedReleaf and CanniMed, in addition to those from Aurora.

Alcanna intends to open 37 stores in Alberta soon after October 17, when recreational cannabis becomes legal to buy countrywide.

Alcanna had planned to open dozens of stores in B.C. as well, although last month the B.C. government announced that it will not allow any company or individual to own more than eight stores.

The government defines an owner as being an entity that controls 20% of a retail operation.

Alcanna’s cannabis operations are run by Paul Wilson, who has been based in B.C. and was previously CEO of Hold It All. That is the holding company for billionaire Chip Wilson’s investments. Chip Wilson and Paul Wilson are not related.

Wilson was not immediately available to provide a reaction to being limited to eight stores in B.C.

Alcanna's CEO, James Burns, however, said in a release that his company has "deep capabilities that will enable us to rapidly develop a large network of well-located cannabis stores, delivering a unique customer experience from October 17, 2018 onwards. Launching this retail network under the Aurora name will capitalize on its reputation as a leader in producing high-quality cannabis products, created with the consumer in mind. We are excited to operationalize this vision, and execute rapidly in Alberta, and across Canada, wherever we are permitted to do so."

gkorstrom@biv.com

@GlenKorstrom