Cannara Biotech Inc. upsizes CIBC Credit Facility to $22 Million

2.2 min readPublished On: December 1st, 2021By

MONTREAL – Cannara Biotech Inc. (TSXV: LOVE) (OTCQB: LOVFF) (FRA: 8CB), an integrated producer of premium-grade cannabis and derivative products with two cultivation facilities based in Québec spanning over 1,650,000 sq. ft., announced the refinancing and upsizing of its current bank credit facility to $22 million from $5.4 million with the primary use of additional funds to be allocated to the repayment of existing higher interest debt and capital expenditure at the Valleyfield facility to fund and accelerate new growing capacity. The existing credit agreement with Canadian Imperial Bank of Commerce has been amended and restated without additional asset security.

“The significant increase in funds and decrease in debt servicing costs from this upsizing reflects our disciplined capital structure and operating strategy,” said Nicholas Sosiak,Chief Financial Officer of Cannara. “The additional capital provided by CIBC under the credit facility leverages only our Farnham Facility while providing additional liquidity as we continue to convert our Valleyfield Facility into an indoor cultivation site to ensure increased capacity and consistent product quality at our facilities. As we continue to invest in capital expenditures, our target to maintain positive quarterly Adjusted EBITDA remains unchanged.”

Key highlights:

  • Refinanced existing credit facility of $5.4M with CIBC to $22M without additional asset security.
  • The Company’s cost of debt decreased from 6.7% to 4.3%.
  • Funds to be used for Valleyfield capital expenditures to achieve increased market penetration and profitability.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Cautionary Statement Regarding “Forward-Looking” Information

This information release contains certain forward-looking information. Such information involves known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from those implied by statements herein, and therefore these statements should not be read as guarantees of future performance or results. All forward-looking statements are based on the Company’s current beliefs as well as assumptions made by and information currently available to it as well as other factors. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Due to risks and uncertainties, including the risks and uncertainties identified by the Company in its public securities filings, actual events may differ materially from current expectations. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

(This information is primarily sourced from Cannara Biotech Inc.  Highly Capitalized has neither approved nor disapproved the contents of this news release. Read our Disclaimer here).

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