News
CannTrust announces $15 million bought deal
Nov. 1, 2017, Vaughan, Ont. - CannTrust Holdings, a licensed producer of medical cannabis under the Health Canada Access to Cannabis for Medical Purposes Regulation ("ACMPR") program, announces that it has entered into an agreement with a syndicate of underwriters co-led by Echelon Wealth Partners Inc. and Bloom Burton Securities Inc. and including a syndicate of underwriters, pursuant to which the Underwriters have agreed to purchase, on a bought deal basis, 3,000,000 common shares of the Company, at a price of $5.00 per Common Share, for aggregate gross proceeds to CannTrust of $15,000,000.
November 1, 2017 By CannTrust
CannTrust has also granted the Underwriters an option to purchase up to 450,000 additional Common Shares of the Company on the same terms as the Offering. If the Over-Allotment Option is exercised in full, the aggregate gross proceeds of the Offering will be $17,500,000.
The net proceeds of the Offering will be used to fund the Phase 2 build out of CannTrust’s recently licensed Niagara Greenhouse Facility and for general corporate and working capital purposes.
Eric Paul, CEO of CannTrust, stated, “We recently announced record revenues and patient numbers and are continuing to see strong trends that we believe will take up full demand from Phase 1 of our recently licensed 430,000 Niagara Greenhouse Facility.”
Brad Rogers, President at CannTrust, added, “The pending legislation to legalize the adult consumer recreational use of cannabis provides a further major opportunity for the Company. With the completion of all phases of our Niagara expansion we plan to have in excess of 1,000,000 square feet of production capacity. This will give us the ability to acquire a substantial share of the increased demand arising from this new market.”
CannTrust expects the first harvest from its Niagara Facility in early November 2017, with full utilization from Phase 1 expected in December 2017. The planned Phase 2 expansion at this Facility is anticipated to be completed and in cultivation towards the middle of 2018. Phase 1 and 2 should conservatively provide the Company with an additional 40,000 kilograms of annual growing capacity.
Closing of the Offering is expected to occur on or about November 30, 2017 and is subject to certain conditions including, but not limited to, the receipt of all necessary regulatory and stock exchange approvals, including the approval of the CSE and the applicable securities regulatory authorities.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any state in which such offer, solicitation or sale would be unlawful. The securities being offered have not been, nor will they be, registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the United StatesSecurities Act of 1933, as amended, and applicable state securities laws.
Mortgage Financing
The Company has also arranged for a $15 million mortgage on the Niagara Greenhouse Facility. The mortgage terms presented to the Company remains subject to the lender’s credit committee approval. Further updates will be provided as they become available. The mortgage financing together with the bought deal Offering would fully fund CannTrust through Phase 2 expansion at the Niagara Greenhouse Facility.
Print this page
