Money Moves: Columbia Care, Zenabis

Columbia Care

Columbia Care Inc.  (OTCQX: CCHWF) said it expects to complete the second tranche of its previously announced $50.0 million financing with the offering of an aggregate principal amount of $15.7 million in 5.00% senior secured convertible notes due 2023. $12.8 million of escrowed funds are expected to close on or by June 22 with the remaining binding commitments closing in early July.

“Columbia Care continues to demonstrate its ability to access the institutional capital markets at attractive terms despite incredibly challenging macroeconomic conditions, validating the confidence that institutional investors have in our company and team,” said Nicholas Vita, CEO of Columbia Care. “Since the start of 2020, including these financings, Columbia Care has raised over US$65 million of new capital, minimizing dilution, enhancing our liquidity position, de-risking our outlook and enabling us to execute on our growth strategy. We will continue to allocate resources to our highest performing markets where opportunities exist to drive incremental profitability and improve our position as the leading nationwide operator. Columbia Care is committed to being a disciplined steward of capital and remains focused on creating shareholder value as we transition to adjusted EBITDA positive in 2020.”

The company said that once it closes the additional $19.7 million, the aggregate financed amount of $54.1 million will exceed Columbia Care’s previously announced target of $50 million. This amount excludes proceeds from the company’s anticipated second and third sale leaseback transactions, expected to close in the third quarter. Also excluded is the company’s previously announced sale of a 10% minority interest in its non-US business to Avalon Pharmaceuticals for $11 million which closed earlier this year and is funding in tranches through the end of the third quarter.

Zenabis

Zenabis Global Inc. (OTC:ZBISF) reported that it has entered into an agency agreement with a syndicate of agents co-led by AltaCorp Capital Inc. and Eight Capital and including Canaccord Genuity Corp., Haywood Securities Inc. and PI Financial Corp. for the sale of up to 157,643,875 Units at a price of $0.13 per Unit for gross proceeds of up to $20,493,704. In addition, Zenabis has granted the Agents an over-allotment option, exercisable in whole or in part, for a period of 30 days following the closing of the Offering, to purchase an additional 15% of the number of Units sold in the Offering. If the Over-Allotment Option is exercised in full, the total gross proceeds to Zenabis will be $23,567,760.

Zenabis said it plans to use the net proceeds of the Offering for general working capital and corporate purposes, the partial repayment of subordinated secured notes, the partial repayment of the Company’s unsecured convertible debentures, the partial or full repayment of it’s $7,000,000 third tranche of senior secured debt and the payment of an extension fee on the remaining balance of Tranche 3, if applicable.

 

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