Author: Margaret Jackson

Canadian cannabis producer Organigram Holdings closed on the second of three tranches of an overall investment of 124.6 million Canadian dollars ($92 million) from a wholly owned subsidiary of British American Tobacco (BAT).

BT DE Investments, the BAT subsidiary, acquired roughly 4.4 million Organigram common shares and 8.5 million Class A preferred shares at CA$3.2203 per share for gross proceeds of CA$41.5 million, according to a news release.

The remaining 12,893,175 shares will be issued in the final tranche, scheduled for around Feb. 28.

Organigram is using most of the funds to fund a strategic investment pool called Jupiter, which is designed to accelerate the company’s international growth goals and target investments both overseas and in the United States.

“With two tranches of the Jupiter pool now funded, combined with our strong balance sheet and targeted investment strategy, Organigram is well on its way to executing on its ambitious growth plan focusing on international, technological and product expansion,” Organigram Chief Strategy Officer Paolo De Luca said in a statement.

Organigram’s first investment of $2 million was made in North Carolina-based Open Book Extracts, a leading ingredient provider, product formulator and manufacturer of hemp-derived extracts and products.

The second investment of 14 million euros ($15.5 million) was made in Sanity Group, a leader in the rapidly growing German medical market.

Organigram shares trade as OGI on the Nasdaq and Toronto Stock Exchange.

Toronto-based Avicanna said it paid off $1.4 million in debt from August 2023 after closing on a nearly $2 million non-brokered private placement of its 6.6 million shares.

Avicanna is a biopharmaceutical company focused on cannabinoid-based products.

In addition to paying off the debt, Avicanna said in a news release that it plans to use the proceeds from the offering for general working capital and administrative expenses and costs related to production and manufacturing as well as research and clinical development.

The unit shares and warrants, and any securities that are issuable upon conversion, are subject to a four-month hold period under Canada’s securities laws.

The offering also is subject to the approval of the Toronto Stock Exchange, where shares of Avicanna are traded as AVCN.

Last August, Avicanna acquired Medical Cannabis by Shopper’s Business from Canadian pharmacy chain Shoppers Drug Mart.

Avicanna paid 2.6 million Canadian dollars ($1.9 million) plus earnout payments based on net revenue for a two-year period.

The company reported 2023 revenue growth of 314%, increasing from $2 million in 2022 to $16.8 million last year.

The increase was largely driven by the Medical Cannabis Shoppers acquisition and the launch of MyMedi.ca.

Consolidated gross profits increased by 500% from $1.1 million in 2022 to $6.7 million in 2023.

The board of TerrAscend Corp., a Canadian-headquartered cannabis operator with U.S. assets, authorized management to repurchase $10 million of its common shares over the next 12 months.

TerrAscend Excecutive Chairman Jason Wild said the buyback program – the company’s first – demonstrates TerrAscend’s confidence in its future and the company’s commitment to enhancing shareholder value.

“We are confident in the strength of our business, growth prospects operational excellence and strong cash flow,’” Wild said in a news release announcing the share-repurchase program.

“We believe our equity has compelling value and will be opportunistic with our share repurchases.”

The 10 million shares represent 5% of the public float based on 291.5 million shares outstanding as of Aug. 16, according to a TerrAscend news release.

The company is limited to repurchasing 65,361 shares per day, which represents 25% of the company’s average trading volume of 261,445 shares on the Toronto Stock Exchange (TSX).

TerrAscend does not expect to incur debt to fund the program and is not obligated to repurchase the shares if management determines there is a better use for its cash reserves.

The Ontario-based company recently closed on a $140 million senior secured term loan from FocusGrowth Asset Management, a capital provider to the marijuana industry, and other members of a loan syndicate.

The loan, which has an interest rate of 12.75%, matures in August 2028 and has no prepayment penalties.