Aurora Cannabis Inc. has inked a deal to buy a minority stake in an Edmonton-based liquor store corporation which plans to launch a brand of cannabis retail stores across Western Canada.

Under the deal, Aurora will acquire a 19.9 per cent stake in the Liquor Stores N.A. Ltd. for $103.5 million through a non-brokered private placement, where a company sells stock directly to private investors to raise capital.

Aurora, an Alberta-based medical marijuana company, will also have an ability to increase its interest in Liquor Stores up to 40 per cent with an additional investment.

'Two great Alberta-based companies have joined forces.' - Terry Booth

Liquor Stores plans to use the money to establish and launch a brand of cannabis retail outlets.

The retailer says it will convert some of its existing stores into cannabis outlets and establish new locations.

Liquor Stores will also use a portion of the money to strengthen its existing liquor retail brands by renovating its existing outlets and for general corporate purposes.

'Retail footprint in Western Canada'

"The private placement with Liquor Stores is transformational in scale and scope for Aurora, Liquor Stores and the cannabis industry in Canada, providing the opportunity for our companies to establish a leading private retail footprint in Western Canada," Terry Booth, CEO of Aurora said in a news release.

"This is an extremely significant step in our corporate development, as we prepare with our partners at Liquor Stores to bring the Aurora Standard in product quality, customer care and strategy execution to the pending legal consumer cannabis market," he said.

"We are thrilled that our two great Alberta-based companies have joined forces."

Liquor Stores NA Ltd operates 231 retail liquor stores across North America. The company operates stores in Alberta, British Columbia, Alaska and Kentucky.

The company's stores operate primarily under the brand names Liquor Depot and Wine and Beyond in Alberta; Liquor Depot and Wine Cellar in British Columbia; Brown Jug in Alaska and The Ultimate Party Source in Kentucky.

Aurora Cannabis is constructing a state-of-the-art 800,000-square-foot medical marijuana facility adjacent to the Edmonton International Airport. Called Aurora Sky, the operation is expected to produce more than 100,000 kilograms of marijuana per year.

In 2015, Aurora was the first medical marijuana operation in Alberta granted a licence by Health Canada, originally for a production facility in Mountain View County, north of Calgary.

The company also operates out of Pointe-Claire, Que. and is currently building a fourth Canadian facility in Lachute, Que.