Hexo Stock Falls On Announcement Of $25 Million Offering

HEXO Corp. HEXO HEXO announced Thursday that it has signed an agreement with institutional investors for the purchase and sale of 14.97 million common shares with an offering price of $1.67 per share for gross proceeds of $25 million.

The company will also issue to the investors common share purchase warrants to buy 7.49 million common shares of the company. The warrants will carry an exercise price of $2.45 per share and a five-year term. 

Hexo said it plans to use the net proceeds from the offering for general corporate purposes, including the company’s research and development operations.

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The offering should end around Dec. 30 once closing conditions are met, including the listing of the common shares on the Toronto Stock Exchange and the New York Stock Exchange.

The sole placement agent for the offering is A.G.P. /Alliance Global Partners.

Hexo Corp is a consumer packaged goods cannabis company that cooperates with Fortune 500 companies, with facilities in Ontario and Quebec.

The stock was down 14.8% at $1.67 in the premarket session. 

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Photo courtesy of Hexo.