Capital Raises

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Capital Raises

Capital Raises Summary

Each week, Viridian publishes insights and analysis on completed capital raise transactions in the prior week, focusing on all equity and debt deals. Our analysis includes:

  • YTD Analysis
  • Sector Focus
  • Capital Raises vs Equity Prices
  • Outlook
  • Sector and Company Performance
  • Capital Raises by Sector

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YTD Analysis

Week ended 05/06/2022

Transactional Activity

  • There was one more transaction and a $25.9 million higher volume this week compared to last week. Compared to the previous year’s same week, one more transaction closed, but volume was down by $311.3 million. The average deal size was $19.4 million this week vs. $63.9 million in the same week last year. Last year’s totals were skewed by the $326.1M Hydrofarm underwritten equity issue, which made up approximately 73% of the total capital raised in the week.

Cannabis capital raises are off 66% YTD:

  • Reduced equity issuance (down 74.5% y/o/y in the U.S. and 91.6% in Canada) was partially compensated for in the U.S. by solid debt issuance (up 78.1% y/o/y; however, Canada’s debt decline of 82.9% brought total debt issuance down by 22.6%. As the graph below shows, capital raises for the first eighteen weeks of 2022 were dominated by U.S. activity. Public companies continue to account for over 75% of total financing YTD, but this is down significantly from 90% in 2021. Private company capital raises are down only 17% YTD relative to the 72% decline for public companies.

Market Commentary and Outlook

This Week Sector Focus

Capital Raises vs Stock Prices

  • There were seven closed capital raises totaling $135.9.0M this week, and non-plant touching sectors dominated activity. Software accounted for 98% of equity capital raised, while Real Estate sector raises accounted for 93% of debt financing.

Best and Worst Stock Performers