Emblem Announces $50 Million Bought Deal

Toronto-based Emblem Corp.  (EMMBF) announced that it has entered into a letter of engagement with Eight Capital  to purchase 12,195,123 units  and 25,000 convertible unsecured debentures on a “bought deal” basis at a price per unit of $2.05  for gross proceeds of $25,000,002 and a price per convertible debenture of $1,000.00  for gross proceeds of $25,000,000, for total gross proceeds of $50,000,002.

Emblem has agreed to grant Eight Capital an over-allotment option to purchase up to an additional 15% of the units at the unit issue price. If this option is exercised in full, an additional $3,750,001 will be raised bringing the aggregate proceeds to $53,750,003. The deal is expected to close on or about February 2.

The company intends to use the proceeds of the Offering to fund strategic growth opportunities and for general and corporate purposes. Emblem Corp. is a fully integrated licensed producer and distributor of medical cannabis and cannabis derivatives in Canada under the ACMPR (Access to Cannabis for Medical Purposes Regulations). It is led by a team of cannabis experts and former healthcare and pharmaceutical executives. It has three distinct verticals – cannabis production, patient education centers, and pharmaceutical dosage form development. Emblem trades under the ticker symbol EMC on Toronto Venture Exchange (TSXV).

According to the OTC Marketplace, Emblem has a market valuation of $91 million and as of December 15, 2017 short interest fell by 45%. The stock was lately trading at $1.52 on the OTC Marketplace, down from its 52-week high of $3.60.

In December CEO Nick Dean said, “With our oils license now in place and the adult-use market on the horizon, we are looking to significantly increase our cultivation capacity, while at the same time maintaining our commitment to produce high-quality product at low cost. Ultimately it’s about being relentlessly driven to deliver a strong return on investment and a solid balance sheet. We will also be mindful of strategic transactions and other opportunities to accelerate our growth objectives in Canada and international markets.”

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