Bank of Montreal acted as agent and lead lender on C$80 million ($60.2 million) in secured debt financing for Canopy Rivers’ joint venture, PharmHouse. Canadian Imperial Bank of Commerce and Concentra Bank also participated as lenders on the facility.
“We are proud to be entering the new year with a significant financial development for PharmHouse, a joint venture we consider well-positioned to pursue the increasingly global cannabis opportunity. Having secured what we believe to be the largest bank debt to a private company in the cannabis industry, one that is supported by a syndicate of three Schedule I banks, PharmHouse has gained substantial momentum,” said Bruce Linton, chairman and CEO of Canopy Rivers. “We believe the commitment made by these leading Canadian financial institutions demonstrates confidence in PharmHouse and sheds meaningful light on the quality of the infrastructure, the level of expertise of the joint venture partners, and the anticipated significant near-term cash flow of this platform,” continued Linton.
The credit facility will be used to finalize the acquisition of a 1.3 million square foot modern greenhouse facility and further fund necessary project equipment and ongoing construction costs as the production and distribution platform ramps up.
The financing has a rate of interest that is expected to average in the mid-to-high 5% per annum range over its three-year term, was secured by Canopy Rivers Corp. and contains customary financial and restrictive covenants.
“Closing this credit facility is a major milestone for both PharmHouse and Canopy Rivers,” said Eddie Lucarelli, chief financial officer of Canopy Rivers. “This strategic and non-dilutive financing is a testament to the dedication of our team in identifying and optimizing the most attractive sources of capital at both the portfolio partner and corporate levels.”
PharmHouse has already secured multiple offtake agreements, with purchase orders in place for an aggregate 30% of the production capacity upon licensing.
Canopy Rivers is a unique investment and operating platform structured to pursue investment opportunities in the emerging global cannabis sector. Its PharmHouse joint venture was formed by the leading principals and operators of a North American agriculture conglomerate.
