Marijuana operator The Cannabist Co. buying back $25 million in debt

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The Cannabist Company Holdings, a marijuana multistate operator, has announced a deal to buy back up to $25 million in principal on senior secured debt by issuing shares.

The senior secured convertible notes, due in June 2025, carry a 6% interest rate.

If the maximum amount of $25 million is repurchased, The Cannabist Co. said, the deal could involve issuing roughly 68.6 million shares.

The debt repurchase was originally announced in September 2023 alongside a $25 million private placement of units with the same institutional investors.

“We are pleased to have reached agreement on the previously announced transaction to reduce leverage and decrease interest expense, maintaining momentum for our balance sheet improvement plan,” Cannabist CEO David Hart said in a statement issued this week.

“We are grateful for the constructive relationship with our investors that enabled this transaction to come to fruition and look forward to delivering on additional initiatives in the months ahead.”

In October, the New York-based MSO announced a $25 million partial redemption of senior secured notes due in May 2024.

The company said in November that it was looking for ways to “reduce debt, reduce interest expense and extend maturities” on other debt.

Hart replaced The Cannabist Co. co-founder Nick Vita as CEO earlier this month.

The company changed its name from Columbia Care in September 2023 after the collapse of Columbia Care’s planned merger with Cresco Labs.