Canopy Growth Corp CGC shares are trading lower Tuesday after the company announced a $30 million private placement.
What Happened: Canopy Growth entered into subscription agreements with certain institutional investors in a private placement offering of 6,993,007 units at $4.29 per unit. The company anticipates gross proceeds of approximately $30 million.
Each unit will consist of one common share and one purchase warrant, which entitles the holder to acquire a share for $4.83.
The offering is expected to close on or about Jan. 10. Canopy said the offering will provide additional liquidity and further strengthen its financial position. The company expects to use gross proceeds to pay down debt, as well as for working capital and other general corporate purposes.
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CGC Price Action: Canopy shares were down 11.1% at $4.48 at the time of publication, according to Benzinga Pro.
Photo: MasterTux from Pixabay.
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