Canopy Growth Announces Closing of Previously Announced Exchange Transaction
Canopy Growth has successfully completed the retirement of approximately $263 million in unsecured debt, enhancing its balance sheet. This transaction involved the exchange of 4.25% unsecured notes due in 2023, enabling the company to reduce its debt obligations and associated interest payments. CBI, through its subsidiary, participated in this transaction. Canopy issued a total of 76,804,412 common shares to noteholders as part of the debt exchange. This strategic move is aimed at preserving cash for future investments while positioning the company to navigate economic headwinds.
- Reduced debt obligations by approximately $263 million.
- Lowered interest payments on 4.25% unsecured notes.
- Increased cash reserves to support future growth initiatives.
- None.
Retirement of Approximately
SMITHS FALLS, ON, July 18, 2022 /PRNewswire/ - Canopy Growth Corporation ("Canopy Growth" or the "Company") (TSX: WEED) (NASDAQ: CGC) announced today that it has closed (the "Final Closing") its previously announced exchange transaction (the "Transaction") of certain
"As we navigate global economic and capital market headwinds, this action has enabled us to deleverage our balance sheet, preserve cash, and reduce interest payments by addressing a substantial portion of our
Pursuant to the terms and conditions of the Transaction, Canopy Growth acquired and cancelled approximately
The Company satisfied the Purchase Price as follows: (a) on the initial closing, 35,662,420 Canopy Shares (the "Initial Closing Shares") were issued to the Noteholders, other than GCILP, based on a price equal to USD
Pursuant to the Transaction, the Company acquired and cancelled
GCILP's participation in the Transaction (the "Insider Participation") is considered to be a "related party transaction" within the meaning of Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions ("MI 61-101"). Pursuant to Section 5.5(a) and 5.7(1)(a) of MI 61-101, the Company is exempt from obtaining a formal valuation and minority approval of the Company's shareholders with respect to the Insider Participation as the fair market value of the Transaction is below
The Transaction was conducted as a private placement, and the Canopy Shares issued in the Transaction were issued pursuant to the exemption from the registration requirements of the Securities Act of 1933, as amended (the "Securities Act"), afforded by Section 4(a)(2) of the Securities Act in transactions not involving any public offering. This press release is neither an offer to sell nor a solicitation of an offer to buy any securities described above, nor will there be any offer, solicitation or sale of any securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.
Cassels Brock & Blackwell LLP and Latham & Watkins LLP acted as legal counsel to Canopy Growth. HudsonWest LLC and BMO Capital Markets acted as financial advisors and exchange agents to Canopy Growth.
Canopy Growth (TSX:WEED, NASDAQ:CGC) is a world-leading diversified cannabis and cannabinoid-based consumer product company, driven by a passion to improve lives, end prohibition, and strengthen communities by unleashing the full potential of cannabis. Leveraging consumer insights and innovation, Canopy Growth offers product varieties in high-quality dried flower, oil, softgel capsule, infused beverage, edible, and topical formats, as well as vaporizer devices by Canopy Growth and industry-leader Storz & Bickel. Canopy Growth's global medical brand, Spectrum Therapeutics, sells a range of full-spectrum products using its colour-coded classification system and is a market leader in both Canada and Germany. Through Canopy Growth's award-winning Tweed and Tokyo Smoke banners, Canopy Growth reaches its adult-use consumers and has built a loyal following by focusing on top quality products and meaningful customer relationships. Canopy Growth has entered into the health and wellness consumer space in key markets including Canada, the United States, and Europe through BioSteel sports nutrition, and This Works skin and sleep solutions; and has introduced additional hemp derived CBD products to the United States through its First & Free and Martha Stewart CBD brands. Canopy Growth has an established partnership with Fortune 500 alcohol leader Constellation Brands.
This news release contains "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 and "forward-looking information" within the meaning of applicable Canadian securities legislation. Often, but not always, forward-looking statements and information can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "estimates", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements or information involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company or its subsidiaries to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements or information contained in this news release. Examples of such statements and uncertainties include statements with respect to the benefits of the debt repurchase and expectations for other economic, business, and/or competitive factors.
Risks, uncertainties and other factors involved with forward-looking information could cause actual events, results, performance, prospects and opportunities to differ materially from those expressed or implied by such forward-looking information, including inherent uncertainty associated with projections; expectations regarding future investment, growth and expansion of operations; regulatory and licensing risks; changes in general economic, business and political conditions, including changes in the financial and stock markets and the impacts of increased rates of inflation; legal and regulatory risks inherent in the cannabis industry, including the global regulatory landscape and enforcement related to cannabis, political risks and risks relating to regulatory change; risks relating to anti-money laundering laws; compliance with extensive government regulation and the interpretation of various laws regulations and policies; public opinion and perception of the cannabis industry; and such other risks contained in the public filings of the Company filed with Canadian securities regulators and available under the Company's profile on SEDAR at www.sedar.com and with the United States Securities and Exchange Commission through EDGAR at www.sec.gov/edgar, including the Company's annual report on Form 10-K for the year ended March 31, 2022.
In respect of the forward-looking statements and information, the Company has provided such statements and information in reliance on certain assumptions that they believe are reasonable at this time. Although the Company believes that the assumptions and factors used in preparing the forward-looking information or forward-looking statements in this news release are reasonable, undue reliance should not be placed on such information and no assurance can be given that such events will occur in the disclosed time frames or at all. Should one or more of the foregoing risks or uncertainties materialize, or should assumptions underlying the forward-looking information prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected. Although the Company has attempted to identify important risks, uncertainties and factors which could cause actual results to differ materially, there may be others that cause results not to be as anticipated, estimated or intended. The forward-looking information and forward-looking statements included in this news release are made as of the date of this news release and the Company does not undertake any obligation to publicly update such forward-looking information or forward-looking information to reflect new information, subsequent events or otherwise unless required by applicable securities laws.
View original content to download multimedia:https://www.prnewswire.com/news-releases/canopy-growth-announces-closing-of-previously-announced-exchange-transaction-301588655.html
SOURCE Canopy Growth Corporation
FAQ
How much debt did Canopy Growth retire recently?
What type of notes did Canopy Growth exchange in the recent transaction?
What was the purpose of Canopy Growth's debt retirement?
Who participated in Canopy Growth's debt exchange transaction?