Canadian cannabis giant Canopy Growth Corporation (TSX:WEED) (NASDAQ:CGC) entered Monday into subscription agreements with certain institutional investors in a private placement offering of 22.93 million units at a price of $1.09 per unit. The aggregate gross proceeds from this offering would amount to approximately $25 million.
The investors also hold an over-allotment option to acquire up to an additional 22.93 million units at a $1.09 per unit for aggregate gross proceeds of $25 million at the discretion of the investors at any time on or before November 2, 2023.
The purpose of the offering is to provide the Company with additional liquidity of up to $50 million to further strengthen Canopy Growth’s financial position and is expected to be used for working capital and other general corporate purposes.
David Klein, the company’s CEO is a speaker at the September Benzinga Cannabis Capital Conference in Chicago, where he’ll likely discuss this news, and share more information about the company’s future plans.
Each unit will be comprised of one common share of the company and one common share purchase warrant. Each Warrant will entitle the holder to acquire one common share from the company at a price equal to $1.35 for a period of five years from the date of issuance. The company has also agreed to provide the investors with customary registration rights.
The closing of the private placement pursuant to the subscription agreements is expected to occur on or about September 19, 2023, subject to customary closing conditions.
Benzinga Cannabis Capital Conference
The Benzinga Cannabis Capital Conference, the place where deals get done, is returning to Chicago this Sept 27-28 for its 17th edition. Get your tickets today before prices increase and secure a spot at the epicenter of cannabis investment and branding.
Canopy shares were trading 14.91% lower at $1.15 per share at the time of publishing during Monday’s pre-market session.
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