Canopy Growth (CGC) traded higher on Thursday after the Canadian cannabis player announced several strategic initiatives aimed at recapitalizing its balance sheet.
The initiatives include an agreement with a group of lenders led by JGB Management Inc. for a term loan maturing in January 2031. The deal is expected to generate $150M in net proceeds and refinance a term loan due in 2027 with a principal value of nearly $101M.
Additionally, the Smiths Falls, Ontario-based company has reached an agreement with an institutional investor to exchange nearly C$96.4M worth of existing convertible debentures due May 2029 for roughly C$80M.
In exchange, the company has agreed to issue C$55M worth of new convertible debentures due in July 2031, C$10.5M in cash, about 9.5M common shares, as well as roughly 12.7M common share purchase warrants.
The transactions are expected to close on or around Jan. 8, boosting Canopy’s (CGC) cash on hand to nearly C$425M.