Knight, Crown Capital Provide Financing to CRH Medical
Knight Therapeutics announced it entered into a senior secured debt agreement with CRH Medical, a North American medical company focused on providing physicians with innovative products and services for the treatment of gastrointestinal diseases. This secured loan will fund CRH’s acquisition of Gastroenterology Anesthesia Associates and GAA Management, collectively a Southeast U.S.-based anesthesia services provider (GAA).
Knight’s secured loan of $30 million will be complemented by (i) a sub-secured loan of C$22.5 million ($19.8 million) from Crown Capital, (ii) an unsecured loan of $2 million from the Bloom Burton Healthcare Structured Lending Fund II, (iii) an equity financing of CRH common shares raising $5 million, (iv) and CRH cash on hand.
The secured loan issued by Knight to CRH will bear interest at a rate of 10% per annum plus other additional consideration. The loan matures on December 1, 2016 and will be extended for one year should CRH meet profitability milestones. The loan is secured by a charge over the assets of CRH and GAA. In addition, Knight has been issued 3,000,000 common shares in the capital of CRH.
“We are thrilled to partner with Knight, a patient lender with proven abilities to build companies, to complete this acquisition by CRH of GAA, which marks our entrance into the lucrative U.S. gastroenterologist services space,” said Edward Wright, CEO of CRH.
Montreal, Canada-based Knight Therapeutics is a specialty pharmaceutical company focused on acquiring or in-licensing innovative pharmaceutical products for the Canadian and world markets.
CRH Medical is a North American company focused on providing physicians with innovative products for the treatment of gastrointestinal diseases.
Toronto and Calgary-based Crown Capital Partners is an investment manager specialized in providing innovative and alternative debt solutions for Canadian growth businesses.