HEXO Corp (CVE: HEXO) has announced it has raised $360 million from a private placement to fund its potential $3.8 billion capital raise. The company said the funding will be used to fund the medical cannabis producer’s potential acquisition of a majority interest in a Canadian cannabis company, as well as further its current international expansion plans. HEXO did not mention the name of the company it is acquiring a stake in, only saying it has a project underway that would see the company put $150 million to work.
We are seeing more and more positive signals for HEXO Corp. (HEXO), which is on track to become one of the leading players in the Canadian cannabis market. The company has been making excellent progress in terms of production and has started to focus more on the potential medical cannabis market with the announcement of a partnership with a Quebec based company named Lydian International.
HEXO Corp Borrows $360 Million to Fund Potential Canadian LP. Read more about hexo corp and let us know what you think.
HEXO Corp announces public offering of Senior Secured Convertible Notes
OTTAWA, May 27, 2021 (GLOBE NEWSWIRE) – HEXO Corp (HEXO or the Company) (TSX:HEXO; NYSE:HEXO) announced today that it has completed an offering (the Offering) of $360,000,000 aggregate principal amount of senior secured convertible notes (the Notes) directly to an institutional buyer and certain of its affiliates or related funds (collectively, the Purchaser). The bonds were sold at a purchase price of $327,600,000, or approximately 91.0% of their face value. The bonds will be issued on 1. May 2023 (expiration date). Subject to certain restrictions, the Notes are convertible at the option of the Investor and, subject to certain conditions and restrictions, at the option of the Company, into marketable common shares of the Company. Unless previously converted, all principal repayments of the bonds will be made at a price equal to 110% of the principal amount of the redeemable bonds. The Notes do not bear interest unless an event of default occurs. The Bonds will be registered bonds without coupons pursuant to a trust agreement dated the 27th. day of May 2021 between the Company and GLAS Trust Company LLC, as trustee (the Trustee), as supplemented and amended by resolutions of the Board of Directors of the Company. The Company expects to use the net proceeds from the offering primarily to fund the acquisition (the potential acquisition) of a large Canadian licensing company (the target company), if completed. The company has not yet reached a final agreement on this potential acquisition. Although negotiations between the parties are at an advanced stage, the Target is not prepared to enter into a definitive agreement for a potential acquisition until the Company has demonstrated that it has sufficient cash to satisfy the expected cash portion of the purchase price. The Company’s obligations under the Notes are secured by a first priority lien on substantially all of the Company’s assets. Payment of the principal of, premium (if any) and interest (if any) on the Notes will be made in full and unconditionally on a security basis by the Corporation’s wholly owned subsidiary, HEXO Operations Inc. The Notes were offered and sold in the United States in a transaction pursuant to the Indenture dated the 25th day before the date of the offering. Registration Statement on Form F-10 (File No. 333-256131) (Registration Statement) filed with the SEC on May 27, 2021, including the underlying prospectus, as supplemented by a prospectus supplement dated May 27, 2021. supplement (collectively, the U.S. prospectus), is registered. In addition, the Corporation has filed a base prospectus dated May 21, 2021 (the Base Prospectus) with the securities regulatory authorities in each of the Canadian provinces and territories, as supplemented by the Prospectus Supplement dated May 27, 2021 (collectively, the Canadian Prospectus). Copies of the registration statement and the U.S. prospectus are or will be available on EDGAR at www.sec.gov and copies of the Canadian prospectus are or will be available on SEDAR at www.sedar.com. These documents are also available upon request from the company at the following address 3000 Solandt Road, Ottawa, Ontario K2K 2X2, Canada, or by calling 1-844-406-1852. The contents of this press release have not been approved or endorsed by any securities regulatory authority. The Corporation does not intend to apply for the listing of the Bonds on the TSX, the NYSE or any other exchange or trading system. This press release is for information purposes only and does not constitute an offer to sell or a solicitation of an offer to buy, nor will there be any sale in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction. A.G.P./Alliance Global Partners acted as sole placement agent for HEXO in connection with this financing. BMO Capital Markets acted as special advisor to HEXO in connection with the financing. About HEXO HEXO Corp is an award-winning consumer cannabis company that develops and distributes innovative products for the global cannabis market. The company serves the Canadian adult-use market under the brand names HEXO Cannabis, Up Cannabis, Original Stash and Bake Sale, and the medical market under the brand name HEXO Medical Cannabis. For more information, visit hexocorp.com. Original press release Stay ahead of the crowd by subscribing to 420 Investor, the largest and most comprehensive subscription service for cannabis dealers and investors since 2013. New Cannabis Ventures is committed to gathering quality content and information about leading cannabis companies to help our readers filter through the noise and stay informed about the most important news in the field. Do you have sensitive information? Please contact us.
In December 2017 HEXO Corp. (CSE:HEXO) completed its public offering of $293 million of convertible senior unsecured debt. The company intends to use the money to fund its expansion into the cannabis sector and to increase its production capacity. The company has already started to acquire several facilities in order to expand its capacity to produce cannabis concentrates.. Read more about hexo price target and let us know what you think.
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