Acreage Holding - ACRDF STOCK NEWS

Acreage Holdings announces updates regarding its acquisition by Canopy USA, expected to complete in mid-December 2024. Due to significant dilution from a June 2024 private placement offering, holders of Fixed Shares (ACRHF) are expected to receive zero value if Canopy's share price remains below US$5.00. The Exchange Ratio for Fixed Shares will be significantly reduced, while the Floating Share Exchange Ratio remains at 0.045 Canopy Shares per Floating Share. Upon closing, Canopy USA will own 100% of Acreage's outstanding shares.

Acreage Holdings reported Q3 2024 financial results with consolidated revenue of $39.6 million, down 30% year-over-year. The company posted a gross margin of 35% and a net loss of $22.2 million. Key developments include launching non-medical cannabis sales in Ohio, representing 38% of state revenue, and securing an $8 million capital infusion through an amended credit agreement. The company's acquisition by Canopy USA is expected to close in the first half of 2025. Operational highlights include Superflux flower launch in Illinois with 44% wholesale penetration and record wholesale revenue in New York.

Acreage Holdings, Inc. (OTCQX: ACRHF) has entered into an amended and restated credit agreement with Canopy Growth and a new third-party lender. The new lender advanced $65 million with a 10% original issue discount. After repaying the prior non-Canopy lender and covering closing costs, Acreage received approximately $8 million in net proceeds. The new agreement features a 13.5% annual interest rate and matures in September 2027.

CEO Dennis Curran stated that this capital infusion will support the expansion of Acreage's retail footprint and strengthen its presence in core markets, particularly in Ohio's new non-medical cannabis market. The agreement also grants the new lender a board observer right. Seaport Global Securities served as the exclusive financial advisor and sole placement agent for the transaction.

Acreage Holdings reported Q2 2024 financial results, showing consolidated revenue of $39.0 million, a 33% decrease year-over-year. The company faced challenges due to credit issues and cash preservation needs, impacting retail inventory and performance. However, Acreage has taken steps to improve its position:

1. Completed a $10 million private placement for working capital.
2. Recapitalized with an amended credit facility.
3. Commenced non-medical sales in Ohio, expected to double revenue in the state by 2025.
4. Focused on re-accelerating growth in core states.
5. Launched new products across its footprint.

The pending acquisition by Canopy USA is progressing, expected to close in the first half of 2025. Despite challenges, Acreage anticipates significant acceleration in revenue and Adjusted EBITDA for the remainder of the year.

Acreage Holdings, Inc. (CSE:ACRG.A.U, ACRG.B.U) (OTCQX:ACRHF, ACRDF) has launched non-medical cannabis sales in Ohio. As of August 6, 2024, The Botanist locations in Akron, Canton, Cleveland, Wickliffe, and Columbus are welcoming non-medical consumers aged 21+. This move aligns with Ohio's transition to a non-medical cannabis market, projected to grow fourfold and reach $2.3 billion within a year.

Acreage expects its Ohio-based revenue to double by 2025, from approximately $50 million in 2023, driving significant improvement in Adjusted EBITDA. The company will offer its flagship brands, The Botanist and Superflux, along with products from partners like Storz & Bickel, Wana Brands, and Jetty. This expansion represents a transformative opportunity for Acreage, positioning it for sustained growth in the Ohio cannabis market.

Acreage Holdings announced Rebecca Kirk's appointment as Chief Operating Officer, effective July 1, 2024. Rebecca Kirk, who joined Acreage in 2019 after its acquisition of CWG Botanicals, brings over 20 years of executive leadership in the cannabis industry. Since 2022, she has served as Executive Vice President at Acreage. CEO Dennis Curran highlighted her role in initiatives that expanded reach, reduced costs, and improved efficiency. As COO, Kirk will optimize operations amid the launch of adult-use sales in Ohio and the completion of the Canopy USA transaction. David Klein, CEO of Canopy Growth, emphasized her pivotal role in high-growth markets in the Northeast. Kirk is also known for her cannabis reform advocacy and her leadership in Oakland’s Social Equity Incubator Program.

Acreage Holdings announced the completion of a US$10 million private placement. The offering consisted of 12,000 units priced at US$833.33 per unit, securing gross proceeds of US$10 million. Each unit includes US$1,000 principal amount convertible notes and Fixed Share purchase warrants. The notes have a 16.67% original issue discount and are convertible into Class E subordinate voting shares. ATB Securities acted as the agent for this placement. The funds will be used for working capital and general corporate purposes. The securities involved are not registered under the U.S. Securities Act and cannot be sold in the U.S. without proper registration or exemption.

Acreage Holdings announced a US$10 million private placement with institutional investors.

Each unit, priced at US$833.33, includes US$1,000 principal amount of unsecured convertible notes and share purchase warrants. The notes are convertible into Class E subordinate voting shares at a specified conversion price, and the warrants are exercisable any time before 60 months post-closing.

Proceeds will aid working capital and corporate purposes, but may result in significant dilution of shares.

Notably, the arrangement with Canopy Growth may see Canopy USA owning 100% of Acreage shares post-acquisition.

If the acquisition isn't completed by the set date, investors can compel Canopy USA to purchase their notes and warrants.

The transaction is important for Acreage's survival, but may adversely impact shareholder value due to significant dilution.

Acreage Holdings announced significant corporate transactions, including the exercise of a call option to facilitate its acquisition by Canopy USA. They also entered into an amended and restated credit agreement with a new lender syndicate. The acquisition is expected to finalize in the first half of 2025, making Canopy USA the sole owner of Acreage. The new credit agreement aims to improve Acreage's cash flow and has a maturity date of January 1, 2026. The CEO emphasized that these changes are transformative, focusing on growth and reduced costs, particularly in key markets like Ohio, Pennsylvania, New York, and New Jersey.