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 03/10/2023

Debt Commentary

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.

Week ended 03/10/2023

  • Debt accounted for 69% of trailing 4-week capital raises. We expect this ratio to be volatile because of the limited capital raise activity. Debt should average over 50% of capital raised, especially since many companies are trading at or close to their 52-week lows. Since year-end, debt costs have significantly increased because of higher treasury rates and risk spreads. We expect continued increases in equity-linked structures.

 

The Week’s Largest Debt Raise:

    • On March 6, 2023, Creso Pharma ( CPH: A.U.)(COPHF: OTC), a developer of pharma-grade cannabis and hemp-derived neutraceutical products, raised $1.68M in a Secured Convertible Note:
    • The note has an 8% coupon and nine-month maturity with an exercise premium of 50%. The effective cost of the issue without fees is approximately 10%. The extra 3% fee on such a short-maturity instrument raises the effective cost to 14.32%.
    • Proceeds will support marketing and sales of the company’s products in Canada, Europe, and the U.S. and for general working capital.

Week ended 03/10/2023

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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.

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. 

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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.