iAnthus Capital Holdings (CSE: IAN) announced this morning that it has secured up to US$100 million in additional financing. The funding comes in the form of senior secured convertible notes through long time partner Gotham Green Partners.
The financing is set to occur in several tranches, of which the first consists of US$20 million. The senior secured notes bear interest at a rate of 13% per annum, which is payable quarterly, and mature on May 14, 2021. The conversion price is set at US$1.89, which represents a 25% premium over Friday’s close. iAnthus has an option to extend the maturity date by a year, however details wer not provided on what the cost of such an extension is.
Warrant coverage to the tune of $10 million was also included as part of a financing. The warrants have an expiry date of three years from the date of issuance, with a conversion price of $1.97.
As per the purchase agreement, Gotham Green Partners has the right to purchase an additional $66.5 million in notes, for a total of $86.5 million overall. Those notes would have substantially the same terms and conversion rights, subject to the policies of the exchange. The remaining $13.5 million would be subject to new terms in the context of the market should Gotham Green wish to fulfill the financing entirely.
The news of iAnthus’ financing comes on the heals of The Deep Dive highlighting the trouble that firms have had, including iAnthus Capital, with closing transactions with Torian Capital and other venture funds. The sector has seen a rapid decline in available funding sources as the hype begins to wear off and operational success becomes a priority. The ability of iAnthus to find additional sources of funding despite this sector sentiment acts as a testament to their ability as operators.
Gotham Green Partners originally provided financing to iAnthus Capital back in May 2018, when the fund invested a total of US$50 million into the firm. That transaction came in the form of senior secured convertible notes, as well as common share units.
iAnthus Capital Holdings closed Friday’s session at $2.01 on the Canadian Securities Exchange.
Information for this briefing was found via Sedar and iAnthus Capital Holdings. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
As the founder of The Deep Dive, Jay is focused on all aspects of the firm. This includes operations, as well as acting as the primary writer for The Deep Dive’s stock analysis. In addition to The Deep Dive, Jay performs freelance writing for a number of firms and has been published on Stockhouse.com and CannaInvestor Magazine among others.