Ascend Wellness announces one of the largest debt deals ever among Cannabis Companies
Company is using proceeds of $235 million debt offering to prepay a three-year note.
Ascend Wellness on Monday announced one of the largest-ever debt-raising transactions for a U.S. cannabis company, with a $235 million private placement of 12.75% senior secured notes due in 2029.
Ascend Wellness AAWH Chief Executive John Hartmann told MarketWatch the deal marks a “significant milestone” for Ascend Wellness at an interest rate that’s lower than many debt financings in the cannabis space.
Ascend Wellness stock fell 1.4%.
Seaport Global Securities LLC was lead financial adviser and sole placement agent for the transaction, which ranks as the fifth-largest in the sector, according to data from Viridian Capital.
Viridian Capital
The proceeds of the debt deal will be used partly to prepay $215 million of an existing term loan, in a move to “enhance the company’s financial flexibility and strengthen its balance sheet,” Ascend Wellness said.
The notes are being offered on a private-placement basis in Canada as well as in the U.S. to qualified institutional buyers and accredited investors.
Ascend Wellness’s stock is down 17.5% so far in 2024, while the AdvisorShares Pure U.S. Cannabis exchange-traded fund MSOS has risen 6.1%.
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