OUR 9TH YEAR OF PROVIDING PROPRIETARY CAPITAL MARKETS INTELLIGENCE ON THE CANNABIS / HEMP / PSYCHEDELIC SECTORS
Debt Capital Raises
Debt Transaction Chart
Viridian publishes weekly data and analysis on debt capital raises in the Cannabis/CBD/Psychedelic industries. This data includes information about the company issuing debt (public/private, state/country location), deal size, deal structure, pricing, warrants, and credit data.
Week ended 03/22/2024
Week ended 03/22/2024
Debt Commentary
Week ended 03/22/2024
- Debt accounted for 17% of trailing 8-week capital raises, the lowest reading since March 2021. The ratio may stay lower than trend line levels if companies utilize favorable regulatory news to issue equity.
- The Week’s Most Significant Closed Debt Transactions
-
- On March 19, 2024, The Cannabis Company (CBST: Cboe)(CBSTF: OTCQX) completed a private placement of $19.5M principal amount of 9% senior secured convertible debentures due 3/19/27
- The notes were sold at a 20% original issue discount to raise $15.6M
- The notes have a conversion price of $.305, representing a premium of 13% over the share price at closing (25% premium at pricing).
- The small premium and significant OID create an effective cost of 28.58%, significantly higher than the yield where the company’s public notes are offered.
- Cannabist is ranked #19/30 in the Viridian Credit Tracker credit model and is an outlier on both Net adjusted debt/ consensus 2024 EBITDA and Total Liabilities/ Market cap. The company has been quite active in taking steps to manage its overleveraged balance sheet. It would be one of the biggest beneficiaries of rescheduling in terms of improved ability to manage its debt load and, more importantly, issue equity to reduce debt.
- In the near term, cannabis has reasonable liquidity with a free cash flow adjusted current ratio of 1.5x.
-
Week ended 03/22/2024
Additional content is available to Premium and Enterprise users. Please purchase a higher tier membership to see more.
Weekly Credit Tracker
Each week, Viridian highlights a specific industry sector and provides a deep dive into credit metrics and comparable company credit rankings for public companies operating in that sector. Credit ratings are not currently available for public cannabis companies leaving companies, lenders, and investors with a gap of information. The Viridian Cannabis Credit Tracker fills this gap. The model uses 11 market and financial statement variables to discern 4 key credit factors: Liquidity, Leverage, Profitability, and Size, to provide credit/liquidity analysis for over 370 public Cannabis/Hemp companies.
- Week ended 03/22/2024
This week’s credit tracker focuses on the 7 Canadian Cultivation & Retail sector companies with market caps between $50M and $500M in the Viridian Value Tracker database in order to make the case that Auxly had a good reason to sell assets, even at prices significantly below its cost: The firm is over levered and needs to sell assets to reduce debt. The Viridian Credit tracker ranking system shows Auxly near the bottom of the peer group in terms of credit quality.
- Week ended 03/22/2024
This Chart is Only Available to Higher Tier Memberships
Please Purchase a Premium or Enterprise membership to see more.
Additional content is available to Premium and Enterprise users. Please purchase a higher tier membership to see more.
This Chart is Only Available to Higher Tier Memberships
Please Purchase a Premium or Enterprise membership to see more.
Viridian publishes weekly insights on debt capital raises in the Cannabis/CBD/Psychedelic industries. These insights typically highlight the most interesting/meaningful debt transactions of that week, and commentary on market conditions, debt deal structures, and lenders.