(This story was updated at 11 a.m. ET on Nov. 9 to include information and comments from Trulieve financials as well as details about a September debt repurchase.)
Marijuana multistate operator Trulieve Cannabis Corp. said it will redeem all of its outstanding 9.75% senior secured notes with a principal worth $130 million, although it remains unclear how the company is paying for the redemption.
The exact cost of the redemption is unknown, but Trulieve said in a Wednesday news release it would include “100% of the principal redeemed, plus accrued and unpaid interest up to, but excluding, the redemption date” of Dec. 1.
Florida-based Trulieve is scheduled to host a third-quarter earnings call Thursday, at which time company executives could share more details about the redemption.
The company’s release did not say how the debt would be repaid.
Trulieve did not immediately respond to an MJBizDaily request for more details.
However, Trulieve had $160 million cash on hand as of June 30.
The company also recently announced an attempt to recover federal taxes worth $143 million by challenging its tax liabilities under Section 280E of the IRS code.
Trulieve closed two offerings of its 9.75% senior secured debt, which involved units including one senior secured note and multiple share purchase warrants.
One offering closed in June 2019, raising gross proceeds of $68.6 million; the second closed in November 2019 for gross proceeds of nearly $61.1 million.
The debt is due to mature in 2024.
Trulieve’s debt redemption announcement comes not long after the company bought $57 million worth of its 8% senior secured notes on the open market in September.
The company said it paid $47.6 million to buy those notes, due in October 2026, “which represents a 16.5% discount to par, plus accrued interest.”
Meanwhile, in third-quarter financials released Thursday, Trulieve reported an $8.2 million quarterly gain from extinguishing that debt.
“Over the remaining course of these senior secured notes, the company estimates interest savings of approximately $14 million,” Trulieve wrote in a regulatory filing.
The company still has outstanding principal worth $368 million on the 8% senior secured notes due in 2026.
The 9.75% debentures trade on the Canadian Securities Exchange as TRUL.DB.U.
Trulieve’s subordinate voting shares trade on the CSE as TRUL.
Solomon Israel can be reached at solomon.israel@mjbizdaily.com.
