Ontario-based Canopy Growth Corp. (TSX: WEED) (Nasdaq: CGC) canceled its planned $30 million private placement.
According to a recent Form 8-K filing with the U.S. Securities and Exchange Commission, the deal, which initially looked to raise capital through the sale of approximately 7 million units, was axed because of delays caused by external factors beyond the company’s control.
The private placement, which was advertised last week, was set to include both common shares and warrants. However, on Friday, just three days after the initial announcement, Canopy and the institutional investors involved mutually agreed to cancel the agreement due to unforeseen third-party delays that impacted the deal’s closure.
Canopy stated that despite the cancellation of this deal, it maintains a stable financial position. The company cited its liquidity, supported by cash, debt facilities, and other potential financing sources to support its position.
The update comes as the firm prepares to publish its fiscal third-quarter financial results on Feb. 9.
As a result of the deal’s termination, no fees will be paid to the placement agents, who were engaged to facilitate the finding of investors for the private placement and were to be compensated with a percentage of the gross proceeds.
A spokesperson for Canopy Growth confirmed that the agreement has been terminated but declined to offer additional details.