4Front Ventures entered into a $10 million senior secured credit facility agreement with ALT Debt II, an affiliate of Altmore Capital. The funds will be disbursed in two tranches and are committed to building out the company’s retail operations in Illinois in connection with the imminent launch of its new state-of-the-art cultivation and processing facility in Matteson.
“This additional capital will fuel our efforts to establish 4Front as a state leader across both our retail and wholesale channels in Illinois and position our operations for long-term, sustainable growth,” Leo Gontmakher, CEO of 4Front, said. “With our new flagship facility in Matteson anticipated to power up before the end of the year, ramping up our retail operations will support a more than fourfold expansion of our production capacity in the state over the next 12 months. We currently have two Mission dispensaries in operation, and our goal is to have our full slate of 10 retail stores before the end of 2024. This funding represents an exciting next step in that direction. Matteson’s enhanced capacity, combined with the expansion of our dispensary network to 10 stores, has the potential to profitably double total company sales.”
“We’re excited to partner with 4Front, as they have proven to be one of the most efficient operators in the industry,” Michael Villapiano, vice president of Altmore Capital, said. “Altmore is proud to support management’s strength of building a successful and sustainable footprint, including their growing retail presence in Illinois, which will complement Matteson’s impressive production capabilities.”
The outstanding principal of the credit facility will bear simple interest at a rate per annum equal to the greater of the WSJ prime rate plus 7% and 15.5%, payable monthly (principal payments postponed until six months after funding). Provided the company extends the maturity of certain other subordinated debt, the maturity date of the credit facility will be Sept. 30, 2026. Full details of the transaction are in the company’s filings.
