- Delta 9 (DN) has announced a binding commitment letter for a C$32M non-dilutive credit facility
- The facility, with connectFirst Credit Union, includes a $23M commercial mortgage facility, a $5M acquisition facility and a $4M authorized overdraft
- The company will use the proceeds for debt repayments, general working capital and continued growth through the acquisition of EBITDA-positive Canadian cannabis businesses
- Delta 9 Cannabis is a vertically integrated cannabis company
- Delta 9 (DN) is unchanged trading at $0.295 per share
Delta 9 (DN) has announced a binding commitment letter for a C$32M non-dilutive credit facility.
The facility, with connectFirst Credit Union, includes a $23M commercial mortgage facility, a $5M acquisition facility and a $4M authorized overdraft.
The mortgage facility matures after five years, amortizes over a 12-year term and will be put toward the following purposes:
- $11.2M for the repayment of existing long-term debt
- $11.8 million for the repayment of Delta’s 8.5-per-cent unsecured convertible debentures due July 17, 2022
The company will pay a five-year fixed rate of 4.55 per cent per year on the mortgage facility and connectFirst prime + 1.50 per cent per year for the authorized overdraft.
The credit facilities will result in $1.2M in operating capital on closing and $470,000 in annualized principal repayment reductions.
Besides debt repayments, it will allocate the proceeds toward general working capital and continued growth through the acquisition of EBITDA-positive Canadian cannabis businesses.
“With this debt financing, Delta 9 has added financial flexibility to optimize its capital structure and is well-positioned to continue to execute its growth strategy,” said John Arbuthnot, CEO of Delta 9.
Delta 9 Cannabis is a vertically integrated cannabis company.
Delta 9 (DN) is unchanged trading at $0.295 per share as of 11:51 am EST.
