HEXO Corp (HEXO) an award-winning consumer packaged goods cannabis company that creates and distributes innovative products to serve the global cannabis demand, announced it has closed an offering worth US$360,000,000 aggregate principal amount of senior secured convertible notes directly to an institutional buyer and some of its affiliates or linked funds. HEXO stock price soared adjacent to the news.
At last check, shares of HEXO Corp. (HEXO) were up 4.75% at $6.84. HEXO stock closed the last session at $6.53, increasing 2.51% or $0.16. Shares of the company fluctuated between $6.23 and $6.54 throughout the day. HEXO shares have risen by 139.90% over the last 12 months, and they have moved up by 12.39% in the past week.
Public Offering of Senior Secured Convertible Notes
The Senior Secured Convertible Notes were sold at a selling price of US$327,600,000 or almost 91.0% of their principal amount. The Maturity date of the notes is May 1, 2023. In accordance to some limitations, the Notes may be convertible into freely tradeable common shares of the company, at the option of the Purchaser and, subject to terms and limitations, at the option of HEXO
If not priorly converted, all principal repayments of the Notes will made be at a price equivalent to 110% of the face value of the Notes being repaid. The Notes will not bear interest except upon the occurrence of an unforeseen circumstance.
HEXO is anticipated to use mainly all of the net proceeds from the Offering to fund the potential acquisition, of a leading Canadian licensed manufacturer. The Company has not yet entered into a confirmed agreement for the Acquisition.
Although negotiations between the companies are taking place, the Target Business is not ready to enter into a definitive agreement for the Potential Acquisition untilHEXO has displayed adequate cash resources on hand to suffice the expected cash portion of the buying price.
Senior Secured Convertible Notes offering worth US$360,000,000 combined with lucrative acquisition’s has surpassed shareholder expectation, with HEXO stock price rising immensely.