Marijuana firm Tilray plans $90 million capital raise amid market turmoil

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Canadian cannabis producer Tilray on Thursday announced a share offering to raise $90.4 million, which the Nanaimo, British Columbia, company says will be used for general corporate purposes.

Tilray priced 7.25 million Class 2 common shares – and 11.75 million prefunded warrants to purchase common shares – at $4.76 per share.

That is a 20% discount to the previous day’s closing price of $5.95.

The offering comes with additional warrants, exercisable six months after issuance at $5.95 per share, with a term of five years.

The offering is expected to close March 17.

Tilray’s recent stock decline has outpaced the broader market, which has experienced significant market turmoil due to the coronavirus pandemic.

Shares of Tilray have fallen 75% in the past month.

The S&P/MX International Cannabis Index has retreated 40% over the same period.

Tilray, founded in 2014, is yet to generate a profit.

The company has reported net losses of $7.8 million, $67.7 million and $321.2 million for 2017, 2018 and 2019, respectively.

Tilray’s adjusted EBITDA loss of $35.3 million in its latest quarter was 33% lower than the previous quarter.

“We intend to continue to expend significant funds to increase our growing capacity, complete strategic mergers and acquisitions, invest in research and development, expand our marketing and sales operations to increase our base of registered patients and meet the compliance requirements as a public company,” the company said in a regulatory filing.

As of Dec. 31, 2019, Tilray said it had cash and cash equivalents of $97 million.

Tilray trades as TLRY on the Nasdaq.

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– Matt Lamers