Akanda Announces Closing of Subsequent Registered Direct Offering
Akanda (NASDAQ: AKAN), a medical cannabis company, closed its second registered direct offering, issuing 2,491,381 common shares at $0.1031 per share and 12,057,600 pre-funded warrants at $0.103 per share. The pre-funded warrants are immediately exercisable at $0.0001 per share. Gross proceeds reached approximately $1.5 million. Univest Securities acted as the financial advisor for the offering. Funds will be used for capital expenditures, operating capacity, working capital, general corporate purposes, refinancing of debt, and acquisitions. The offering was made under an effective shelf registration statement filed with the SEC.
- Closed second registered direct offering successfully.
- Issued 2,491,381 common shares at $0.1031 per share.
- Issued 12,057,600 pre-funded warrants at $0.103 per share.
- Gross proceeds of approximately $1.5 million.
- Funds to be used for capital expenditures, operating capacity, and general corporate purposes.
- Funds also for refinancing existing debt and acquisitions.
- Share dilution due to issuance of 2,491,381 common shares.
- Potential future dilution from 12,057,600 pre-funded warrants.
- Offering priced at the minimum price under Nasdaq rules, indicating potential low investor confidence.
- Gross proceeds of $1.5 million before deducting fees and expenses might not be substantial for large-scale projects.
Insights
Akanda Corp.'s recent direct offering of shares and pre-funded warrants is a noteworthy event for investors. The company raised approximately
However, it also leads to dilution of existing shares, which could negatively impact the share price in the short term. Given the offering price of
In the short term, expect some pressure on Akanda's stock price due to share dilution. Long-term benefits will depend on how effectively the funds are utilized to improve operational efficiency and drive growth.
From a market perspective, Akanda's direct offering can be viewed in the context of the broader medical cannabis industry. This sector has seen significant growth, but it also faces regulatory hurdles and market saturation in some areas. By bolstering its financial position, Akanda aims to better navigate these challenges and potentially expand its market share.
However, raising funds at such a low share price may reflect underlying concerns about the company's current market valuation. It's essential for investors to consider industry trends and competitive dynamics when evaluating the long-term prospects of Akanda.
Investors should keep an eye on how these funds are leveraged to drive strategic growth. Examples include acquiring complementary products or businesses, which could provide a competitive edge. The company's success in these areas could translate into enhanced shareholder value over time.
London, United Kingdom--(Newsfile Corp. - May 20, 2024) - Akanda Corp. (NASDAQ: AKAN) ("Akanda" or the "Company"), an international medical cannabis company, today announced that it has closed its previously announced second registered direct offering for the sale and issuance of 2,491,381common 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 May 20, 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 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 Cellen Life Sciences' Leva Clinic, one of the first fully digital pain clinics in the UK. Akanda also acquired the right to develop a Canadian farming property in British Columbia, including farming land and related operations and licenses. The Company plans to develop THC and cannabinoid (CBD) facilities at this site.
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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/209861
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