Akanda Announces Closing of Registered Direct Offering Priced At-the-Market Under Nasdaq Rules
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Insights
The closing of Akanda Corp's registered direct offering marks a significant capital infusion for the company. The issuance of common shares and pre-funded warrants at market price indicates a strategic move to bolster the company's financial position. With gross proceeds of approximately $708,000, the capital raised is relatively modest, which suggests that this transaction is targeted at meeting immediate financial needs rather than funding large-scale expansions.
Investors should note that the offering price per share reflects the current market valuation of the company, which is a critical factor in assessing dilution effects. The immediate exercisability of the pre-funded warrants for a nominal fee of $0.0001 per share provides warrant holders with significant leverage, while the company benefits from potential future capital if these warrants are exercised. However, the beneficial ownership limitations could prevent a single entity from acquiring a controlling interest, thus maintaining a degree of balance in shareholder power.
The intended use of net proceeds for capital expenditures, operating capacity and potential acquisitions could drive future growth, but it also indicates that Akanda might be seeking to address liquidity concerns or refinance existing debt. The effectiveness of these strategies will largely depend on the company's ability to manage its capital efficiently and generate returns on these investments.
The securities offering conducted by Akanda Corp was executed in compliance with the Securities Act of 1933, as evidenced by the use of an effective shelf registration statement. This approach allows for a more streamlined and rapid process of capital raising, as companies can offer and sell securities without the need for a separate registration for each issuance.
It is important for stakeholders to understand that the offering's compliance with SEC regulations, including the filing of the final prospectus supplement, provides transparency and reduces legal risk. The availability of offering documents on the SEC's website ensures that current and potential investors have access to essential information required to make informed decisions.
The clear statement that the press release does not constitute an offer to sell or a solicitation of an offer to buy ensures that Akanda is adhering to legal advertising norms and avoiding any potential miscommunication that could lead to regulatory scrutiny or investor confusion.
From a market perspective, the offering by Akanda Corp should be evaluated in the context of the medical cannabis industry's growth trajectory and competitive landscape. The sector is known for its high capital expenditure requirements due to the need for compliance with stringent regulatory standards, research and development and expansion of production facilities.
The relatively small amount of capital raised could signal cautious investor sentiment or a strategic decision by Akanda to avoid excessive dilution of existing shares. This can be contrasted with larger offerings that might indicate more aggressive growth strategies or substantial funding requirements.
The impact of this capital raise on Akanda's market position will depend on how effectively the funds are deployed. If used for strategic acquisitions or to enhance operating capacity in ways that improve competitive advantage, there could be positive implications for the company's market share and investor confidence.
London, United Kingdom--(Newsfile Corp. - February 2, 2024) - Akanda Corp. (NASDAQ: AKAN) ("Akanda" or the "Company"), an international medical cannabis company, today announced that it has closed its previously announced registered direct offering for the sale and issuance of 280,851 common shares at a purchase price of
Univest Securities LLC is acting as the exclusive financial advisor in connection with the offering.
The gross proceeds to Akanda from this offering were approximately
The securities described above were offered pursuant to an effective shelf registration statement on Form F-3, as amended (File No. 333-276577) previously filed with the Securities and Exchange Commission ("SEC") and was declared effective on January 29, 2024. The securities were offered only by means of the prospectus supplement and the accompanying base prospectus that form a part of the registration statement. The final prospectus supplement and accompanying base prospectus relating to the offering was filed with the SEC on February 2, 2024 and will be available free of charge on the SEC's website at http://sec.gov.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy these securities, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction. Any offers, solicitations or offers to buy, or any sales of securities will be made in accordance with the registration requirements of the Securities Act of 1933, as amended.
About Akanda Corp.
Akanda is an international medical cannabis and wellness platform company seeking to help people lead better lives through improved access to high quality and affordable products. Akanda's portfolio includes Holigen, a Portugal-based cultivator, manufacturer and distributor with an EU GMP certified indoor grow facility; CanMart, a UK-based fully licensed pharmaceutical importer and distributor which supplies pharmacies and clinics within the UK. The Company's seed-to-patient supply chain also includes partnerships with California-based Cookies, the most globally recognized cannabis company in the world; Cansativa Group, a leading importer and distributor of medical cannabis in Europe; and Cellen Life Sciences' Leva Clinic, one of the first fully digital pain clinics in the UK.
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Cautionary Note Regarding Forward-Looking Information and Statements
This press release contains certain statements that may constitute "forward-looking statements" within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Such forward-looking statements are not representative of historical facts or information or current condition, but instead represent only Akanda's beliefs regarding future events, plans or objectives, many of which, by their nature, are inherently uncertain and outside of Akanda's control. Generally, such forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or may contain statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "will continue", "will occur" or "will be achieved". Forward-looking statements may relate to anticipated events or results including, but not limited to business strategy, product development and sales and growth plans. The forward-looking statements contained in this press release are made as of the date of this press release, and Akanda does not undertake to update any forward-looking statements that are contained or referenced herein, except in accordance with applicable securities laws.
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/196746
FAQ
What is the recent offering announced by Akanda Corp. (AKAN)?
What is the intended use of the net proceeds from the offering?
Under which registration statement were the securities offered?
Where can the final prospectus supplement and accompanying base prospectus be accessed?
