Heritage Cannabis Holdings Corp (CSE:CANN) announced Tuesday that it has raised more than C$17 million to increase its extraction capacity and fund further investments as part of the holding company’s portfolio of assets.
In addition to extraction, the cannabis holding company plans to use the proceeds to finance other investments by its four portfolio companies. As well, Heritage is looking at advancing new international opportunities. A portion of the funds will also be used for working capital and general corporate opportunities.
Shares of Heritage rose 3.5% on Tuesday morning to C$0.59 in Canada.
The offering consisted of 32.6 million units of the company priced at $0.53 per unit for gross proceeds on $17.3 million. The total includes a $2.2 million overallotment option exercised by the underwriters of the offering.
Each unit consists of one share and one warrant that entitles the holder to purchase shares at $0.70 per share for a 30-month period following the close of the deal. If the average trading price of Heritage stock exceeds $1.05 for 20 consecutive trading days, however, the company will be entitled to accelerate the exercise of warrants for a 21-day period following written notice of such actions.
Based in Vancouver, Heritage is focused on becoming a vertically integrated cannabis provider. It currently has two Health Canada-approved licensed producers through its subsidiaries Voyage Cannabis Corp and CannaCure Corp.
As part of these two licences, Heritage has two additional subsidiaries, Purefarma Solutions, which provides extraction services, and Calyx Life Sciences, which is focused on cannabis based medical solutions.
Heritage provides its portfolio companies with the resources to advance their products or services to compete both domestically and internationally.
The offering was led by a syndicate of dealers including Cormark Securities Inc, PI Financial Corp, Canaccord Genuity Corp and Desjardins Capital Markets. The underwriters received cash commissions equal to 7% of the units sold.
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