Indiva Limited to receive $22-million strategic investment from Sundial Growers
CALGARY-BASED SUNDIAL GROWERS Inc. a Canadian licensed producer of recreational cannabis, has announced a $22-millionstrategic investment in London-based Indiva Limited.
The investment will be completed in the form of a brokered private placement led by ATB Capital Markets Inc. of 25,000,000 common shares of Indiva at a price of $0.44 per Common Share, to raise gross proceeds of $11 million, and a non-revolving term loan facility to Indiva in the principal amount of $11 million. It is anticipated that Sundial will be the sole subscriber in the placement.
Proceeds to Indiva, net of fees, commissions and expenses are expected to be approximately $20.9 million.
“Sundial is pleased to support the development of Indiva’s high-quality products,” says Zach George, chief executive officer of Sundial. “This transaction broadens our exposure to the rapidly expanding cannabis edibles category.”
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Headquartered in Calgary with operation in in Olds, AB, and Rocky View County, AB, Sundial’s brand portfolio includes Top Leaf, Sundial Cannabis, Palmetto and Grasslands.
According to Indiva, the company will use the net proceeds of the placement and term loan to retire its outstanding debt in full, which includes its demand loan and promissory note, as well as for working capital and other general corporate purposes.
“We are delighted to welcome Sundial as a strategic investor in Indiva,” notes Niel Marotta, president and CEO of Indiva. “The capital from this $22-million investment significantly improves Indiva’s balance sheet, expands our working capital, and provides the resources necessary to support strong growth in our business.
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“Indiva will now have the ability to make additional capital investments, primarily into automation, which will drive higher throughput and profitability, while ensuring our product quality maintains the best-in-class standard our customers and clients depend upon,” continues Marottra. “Indiva’s bolstered financial strength will ensure we can defend our market share position as a top edibles producer in Canada, and continue to bring new and innovative cannabis products to of-age Canadians.”
Sundial and Indiva intend to complete the investment later this month, subject to regulatory conditions including the approval of the TSX Venture Exchange. The securities issued under the placement will be subject to a statutory hold period of four months and one day following the closing of the placement.