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The Valens Company enters into C$40 million syndicated credit facility

The financing consists of a C$20 million secured term loan and a C$20 million secured revolving loan as well as an option for an additional C$10 million

The Valens Company - The Valens Company has entered into a syndicated credit facility that would provide it up to C$40 million of secured debt financing
Valens said proceeds from the credit facility will further strengthen its balance sheet

The Valens Company (CVE:VLNS) (OTCQX:VLNCF) said it has entered into a syndicated credit facility that would provide it with up to C$40 million of secured debt financing.

The Canadian Imperial Bank of Commerce is the co-lead arranger and administrative agent, and ATB Financial is the other co-lead arranger.

Valens said the credit facility consists of a C$20 million secured term loan and a C$20 million secured revolving loan, with an accordion feature that could allow the cannabis company to increase the aggregate commitments by up to an additional C$10 million. 

READ: The Valens Company sees record revenues in fiscal Q1 as white label business expands

The financing carries a three-year term and is secured by a first ranking charge over substantially all the company's assets.

Valens said proceeds from the credit facility will further strengthen its balance sheet, allowing for the continued expansion of its operations and execution of its corporate strategy, including gaining access to new domestic and global opportunities to increase shareholder value.

"Although we are already well-capitalized, the credit facility increases our financial flexibility and brings down our overall weighted average cost of capital,” Valens CEO Tyler Robson said in a statement.

“With our enhanced balance sheet, we are well-positioned to continue to expand our innovative product portfolio, build out our custom manufacturing platform, be opportunistic in a consolidating market and maximize capital allocation to generate the highest return on invested capital for our shareholders.”

Valens is focused on becoming a partner for leading Canadian and international cannabis brands by providing best-in-class, proprietary services including CO2, ethanol, hydrocarbon, solvent-less and terpene extraction, analytical testing, formulation and product development and custom manufacturing.

Contact the author: [email protected]

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Price: 2.1 CAD

TSX:VLNS
Market: TSX
Market Cap: $268.19 m
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