Cannabis multistate operator Ascend Wellness Holdings said it’s received commitments to raise $235 million in a private placement.
The senior secured notes, expected to price at 94.75% of face value, carry a 12.75% interest rate and are due in 2029, the New York-based MSO said in a Monday news release.
Proceeds from the private placement, along with cash, will be used to prepay $215 million of principal under an existing term loan “to enhance … financial flexibility and strengthen its balance sheet.”
The $60 million of remaining principal under the loan can be carried through the due date at a 9.5% interest rate.
The offering, which is being handled by New York-headquartered Seaport Global Securities, is expected to close by Tuesday.
The refinancing marks a significant milestone for Ascend, according to CEO John Hartmann.
“The 5-year notes financing reflects the confidence our lenders have in our business and growth prospects, while enhancing our financial stability and flexibility,” he said in a statement.
”The support from a majority of our existing term loan lenders, including all of our four largest lenders, highlights their trust in our strategic vision.”
Ascend reported in May that gross revenue in the first quarter increased 23.4% year-over-year to $174.2 million.
The company posted a net loss of $18.2 million during the quarter, compared with a $18.5 million loss a year earlier.
Ascend generated $3.9 million in cash flow from operations, its fifth consecutive quarter of positive operating cash flow.
MJBizDaily reported in March that Ascend filed amended federal tax returns for several years and expects to receive refunds from Section 280E.
