Organigram Sees BAT Invest A Further $6.3 Million Under Top-Up Rights
It appears that British American Tobacco, or BAT, is still focused on maintaining its stake in Organigram Holdings (TSX: OGI). The firm last night announced it was exercising certain top-up rights it has as a part of its 2021 investment agreement in the firm to slightly increase its stake.
The top-up has seen the tobacco firm invest a further $6.3 million into the cannabis company, enabling it to push its current ownership from 18.8% to 19.5%. The ownership increase saw a total of 2.7 million shares of the issuer sold at a price of $2.3868, effectively a significant 24.9% premium to the current price of the equity. The premium is due to the top-up rights outlining that the “top-up” is to be consistent with the price per share at which the related issuances were made that enabled the rights to come into effect.
The eligibility for the top-up follows Organigram acquiring Laurentian Organic in the fourth quarter, resulting in the issuance of 10.9 million shares.
While the top-up indicates that BAT remains interested in the company, it is notable that the firm increased its ownership just to 19.5%. Under the original arrangement last year, the company took an initial 19.9% stake in Organigram, paying $221 million at $3.792 per share to do so.
Organigram Holdings last traded at $1.91 on the TSX.
Information for this briefing was found via Sedar and Organigram 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.