- Cann Group (CAN) is looking to raise $20 million in extra cash via a placement and share purchase plan (SPP)
- The medicinal cannabis business received commitments to raise $10 million via the placement, with CAN directors subscribing for $1 million worth of shares
- Under the SPP and the placement, investors are able to buy new CAN shares at 27.5 cents each – a 27.6 per cent discount to the last closing price
- The funds from the capital raise will help CAN upgrade numerous sectors within its Mildura facility and expand its Satipharm distribution
- Cann shares closed down 15.8 per cent at 32 cents each on Monday, July 26
Cann Group (CAN) is looking to raise $20 million in extra cash via a placement and share purchase plan (SPP).
The company came out of a trading halt on Monday morning to announce it had already received commitments to raise $10 million via the placement.
Among those investing in the medicinal cannabis business are several CAN directors, who subscribed for $1 million worth of shares.
Under the placement, investors were able to buy new CAN shares at 27.5 cents each – a 27.6 per cent discount to the last closing price.
The same offer will be made to shareholders taking part in the SPP, which requires CAN shareholders’ approval before it can open.
Explaining the purpose of the raise, Cann CEO Peter Crock said some of the funds would go towards upgrading the company’s Mildura-based facility.
“With the commissioning of a number of important components of the
Mildura facility to be underway over the balance of this calendar year, we are confident in our ability to secure and supply additional geographic markets and market segments over the next 12 months,” Mr Crock said.
“The Mildura facility provides the Company with a platform for sustainable and profitable growth as we scale up with improved supply chain security and a reduced reliance on third parties.
“We expect that the funding we are seeking via this capital raising will be sufficient to support our operations and expansion as we build our revenue base and move towards sustainable profitability.”
Cann said the funds from the capital raise would also go towards helping expand the marketing and distribution of Satipharm in Europe.
It’s expecting the placement to settle on July 28, before the new shares begin trading on July 29.
After resuming trade, Cann Group’s share closed down 15.8 per cent at 32 cents each on Monday, July 26.