Curaleaf Holdings Inc (CSE: CURA) (OTC: CURLF) announced Friday that it has obtained commitments from a syndicate of lenders for a $275-million senior secured term loan facility with an annual interest rate of 13%.
The maturity date for the loan is 48 months from closing, according to the vertically integrated cannabis company.
The commitments are from existing lenders and U.S.-based institutional investors, CURALEAF said. The proceeds are intended for the refinancing of existing debt, the satisfaction of transaction fees and expenses from previously announced acquisitions, the funding of capital expenditures and general corporate purposes.
The sole placement agent for the loan is Seaport Global Securities.
"This transaction is a historic milestone for Curaleaf. Our track record of continuously improving results has attracted a strong group of institutional investors who share our belief that we have established a leading credit profile in the cannabis industry," CEO Joseph Lusardi said in a statement.
"Importantly, we have raised debt capital at attractive terms without the need to dilute our shareholders. We believe this additional capital fortifies Curaleaf's balance sheet to take advantage of the significant market opportunities that exist in this space."
The capital puts Curaleaf in a strong position as its business scales and generates positive free cash flow, CFO Neil Davidson said in a statement.
"Further, we believe our pending acquisitions, most notably Select and Grassroots will benefit from our expanded balance sheet, both of which are expected to close early next year."
The stock was trading 4.9% higher at $5.56 at the time of publication Friday.
Photo courtesy of Curaleaf.