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Hexo Shares Fall Slightly On Heels Of $124M At-The-Market Offering

May 11, 2021 2:00 pm
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Hexo Shares Fall Slightly On Heels Of $124M At-The-Market Offering

HEXO Corp. (TSX:HEXO, NYSE:HEXO) announced Tuesday it has created an at-the-market equity program (“ATM program”) by which it could issue and sell up to CA$150 million ($124 million) of its shares.

Under the ATM program, shares can be sold from treasury to public, from time to time, and at the company’s discretion.

All shares sold under it will be made via “at-the-market distributions,” following the terms of an equity distribution agreement signed May 11, 2021 by the company, A.G.P./Alliance Global Partners and BMO Capital Markets Corp., as U.S. agents, and BMO Nesbitt Burns Inc., as Canadian agent.

The price of shares may vary under the ATM program, following active market prices at the time of each sale. The ATM program will run until the earlier of the issuance and sale of all shares set up under it and June 7, 2023, unless closed prior to such date by the company or the agents.

The cannabis-focused consumer packaged goods company plans to utilize the collected net proceeds from the ATM program for the following corporate practices:

  • Expansion activities, including the planned purchase of a facility in Colorado;
  • Capital expenditures, including advancements of the production lines at the Company’s Belleville, Ontario facility;
  • Potential future purchases;
  • Working capital, including minimum debt repayments connected to the Company’s proposed acquisition of Zenabis Global Inc.

Hexo’s shares were trading 8.03% lower at $6.64 per share at the time of writing.

Photo by davide ragusa on Unsplash

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