Marijuana firm GrowForce closes CA$38M raise ahead of public markets debut

Toronto-based GrowForce Holdings has closed a funding round of 38 million Canadian dollars ($29.1 million) as the firm prepares to go public later this quarter.

Capital from the equity raise will be used to expand the company’s cultivation operations and for strategic acquisitions, the firm said in a news release.

Under terms of the offering, GrowForce issued 7.8 million brokered subscription receipts exchangeable for common shares at a price of CA $3.20 – amounting to CA$25 million.

The company also issued 4.1 million nonbrokered subscription receipts at the same price for gross proceeds of approximately CA$13.2 million.

The raise is tied to GrowForce’s plans to go public via a reverse takeover of Toronto-based Platform Eight Capital – a deal expected to close later this quarter.

GrowForce was launched and spun off in April by Denver-based MJardin. The two firms entered into a licensing agreement that gives MJardin exclusive rights to GrowForce’s cannabis management services and intellectual property portfolio in Canada and international markets.

For the offering, Cormark Securities and Canaccord Genuity Corp. acted as co-lead agent, together with a syndicate of agents, including Haywood Securities, KES 7 Capital and Mackie Research Capital Corp.

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