- Pharmaceutical cannabis company Creso Pharma (CPH) has tapped investors for $2.1 million today
- The company will be raising the new funds through a six-cent share placement
- This represents a neat 14.5 per cent discount on Creso's 10-day volume-weighted average price
- The company said new funds will be used to keep growing its human and animal health cannabidiol products and pay back some debt
- However, retail investor's are not getting a chance to take part in the placement, with the full $2.1 million secured from professional investors
- Shares in Creso are in a trading halt today, but shares last traded on May 26 for 6.8 cents each
Pharmaceutical cannabis company Creso Pharma (CPH) has tapped investors for $2.1 million through a share placement today.
The company will be issuing roughly 35.6 million new shares at six cents a throw to raise the funds. This represents a neat 14.5 per cent discount to Creso's 10-day volume-weighted average price and a discount of almost 12 per cent to the company's last closing price.
However, Creso said it has received "firm commitments" to raise the full amount from sophisticated and professional investors — meaning mum and dad shareholders won't get a chance to top up at the discounted price.
The new money will be used to keep growing the company's human and animal health cannabidiol (CBD) product lines, pay back some debt, and general working capital.
Creso CEO and Co-Founder Dr Miri Halperin Wernli said several new investors have come on board with today's share placement.
"Creso Pharma is continuing to see strong demand for our nutraceutical and animal feed products across our key target markets which is very encouraging and I look forward to reporting on further developments and opportunities in the near-term," Dr Miri said.
The placement will take place in three tranches.
In the first tranche, roughly 20.8 million shares will be issued to raise the first $1.25 million. The company does not need shareholder approval to complete this part of the placement.
The second tranche will raise just under $800,000 subject to the consent of the secured investors.
The third tranche will raise the remaining $100,000 subject to shareholder approval.
Creso shares have been in a trading halt since May 26, so it is not yet sure how investors will react to the news of today's capital raise. Shares in the company last traded for 6.8 cents each in a $15.27 million market cap.