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.
Debt Commentary
- Debt accounted for 65% of trailing 8-week capital raises. The ratio may go down if companies are able to utilize favorable regulatory-induced stock price increases to complete equity issues. However, equity pricing has remained stubbornly low while the cannabis debt capital markets have reopened.
- The Week’s Debt Transactions
- Advanced Flower Capital (AFCG: Nasdaq), a leading commercial mortgage REIT that provides institutional loans to cannabis operators, renewed its senior secured revolving credit facility with a commitment from a $75B FDIC-insured commercial bank.
- The three-year facility, with an initial draw of $40M, can expand to $100M, subject to lender participation and borrowing base availability.
- The loan is priced at prime plus 0.5%, subject to a prime floor of 6.50%
- Proceeds will fund unfunded commitments to existing borrowers and the origination of new loans.
- The chart below indicates that AFCG got excellent terms on this loan. The chart shows that the company trades at the lowest market/book (blue bar) ratio of the four competitors, implying questions about mark-to-market on AFCG’s assets. AFCG has the highest leverage of the group based on the total liabilities to assets ratio (orange bar), and it has the lowest annualized funds from operation to assets ratio, implying generally lower profitability than the group.
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.