Cronos Group secured 40 million Canadian dollars ($32 million) for the continued construction of its 315,000-square-foot new Peace facility in Stayner, Ontario, which it says is the largest purpose-built indoor cannabis production facility in the world.
Cronos, based in Toronto and traded on the TSX Venture Exchange, entered into a commitment letter for CA$40 million in debt financing with Romspen Investment Corp., which will provide the funds to Cronos’ wholly owned licensed producer, Peace Naturals Project Inc.
The loan will be made available in multiple advances starting in September, and the annual interest rate of 12% accrues only on advances made, Cronos said in a news release. The loan carries a two-year term with a one-year extension option.
The new facility is expected to be fully operational by next summer and will bring Peace’s annual production capacity to 40,000 kilograms (88,000 pounds). It’s part of Cronos’ long-range plan to grow Peace Naturals’ cultivation footprint to nearly 350,000 square feet.
Canada’s medical cannabis growers have collectively raised more than CA$1 billion this year to ramp up production to meet growing demand.