HARV stock is gaining momentum in Friday’s trading session after Harvest Health and Recreation Inc (CSE:HARV) (OTCQX:HRVSF) said that it will be conducting financing in the form of secured notes.
Due to the difficulties being faced in the cannabis industry, many companies in the sector are looking to raise capital through a range of different offerings in the market, and Harvest Health and Recreation Inc is the latest one to do so. Today the company announced an offering of senior secured notes and units.
The units are going to be comprised of $1,000 of the principal amount of the senior secured notes and as many as 109 share purchase warrants. The warrants are going to give the holder the right to buy a subordinate voting share in Harvest Health for a three-year period.
The company has apparently got commitments from its lead investors of subscriptions to the tune of $90 million. Canaccord Genuity Corp. and A.G.P./Alliance Global Partners are going to be the lead partners. The notes are going to mature in three years.
HARV stock is up 5% at $3.30.
Back in November, Harvest Health and Recreation released its financial results for the third quarter and managed to record 197% year-on-year revenue growth. Revenue for the quarter stood at $33.2 million, and the adjusted EBIDTA loss was reduced to $10.9 million from $12.4 million in the previous quarter.
However, the net losses for the quarter stood at $39.1 million, and the company stated that the loss was a reflection of the investments that had been made in order to keep Harvest Health’s growth on track. Back in November, there was another important development with regards to Harvest Health.
The company announced that it had decided to terminate a deal that it had signed to acquire CannaPharmacy. The deal would have given Harvest Health and Recreation licenses to operate in the states of New Jersey, Delaware, and New Jersey. However, the prevailing conditions in the market have made the company change its decision with regards to the deal.
Instead, Harvest Health has acquired a CannaPharmacy subsidiary called Franklin Labs LLC for $26 million. The company will pay $15 million in cash and $11 million in promissory notes. That being said, the deal is subject to alterations, and other assets could be added in the future.
HARV stock is one of the biggest losers this year, with a fall of 55% due to broader sell-off in the cannabis sector.
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