Cannabis producer Hexo raises CA$46 million in public offering

Ontario-based cannabis grower Hexo on Monday announced the closing of an underwritten public offering worth 46 million Canadian dollars ($33 million).

The offering sold 59,800,000 units for CA$0.77 each. Each unit included one common Hexo share and one common share purchase warrant, exercisable within five years at CAD$0.96 per share.

Proceeds from the offering will be used “for working capital and other general corporate purposes,” according to a news release.

Hexo recently reported a net loss of nearly CA$300 million for its second quarter, driven by an impairment charge for disposing of a former Newstrike cannabis cultivation facility.

Net revenue from recreational cannabis sales was up 20% on a quarterly basis.

At the time, Hexo said its existing funds, “combined with existing debt facilities, are not sufficient to support ongoing operations, existing commitments and costs of acquiring new investments for increased product offerings.”

Hexo trades as HEXO on the New York Stock Exchange and Toronto Stock Exchange.