Acreage Enters into Amended and Restated Credit Agreement
Acreage Holdings, Inc, a leading U.S.-based cannabis cultivation and retail company, has secured a new financing deal, fortifying its position in the fast-evolving cannabis industry. Acreage announced that it has entered into an amended and restated credit agreement in partnership with a subsidiary of Canopy Growth Corporation and a third-party lender. This revised credit arrangement marks a significant step for Acreage as it expands its retail operations and capitalizes on emerging market opportunities.
The new lender has extended a loan of $65 million to Acreage, which includes a 10% original issue discount, amounting to $6.5 million. Of the funds provided, $48 million was allocated to repay the company’s previous obligations under a prior credit agreement. The remaining net proceeds of around $8 million, after accounting for closing costs, will be used to fuel Acreage’s growth initiatives.
Dennis Curran, Chair and CEO of Acreage, commented on the importance of this capital boost: “This infusion will enhance our ability to expand our retail footprint and bolster our presence in key markets. With a stronger financial foundation, we are poised to seize high-growth opportunities, particularly in Ohio’s newly established adult-use market.”
Under the revised terms of the agreement, the loan comes with a 13.5% annual interest rate and will mature on September 13, 2027. The New Lender will receive interest payments in cash, while Acreage has the flexibility to pay Canopy’s interest in either cash or kind, with initial payments being made in-kind. The New Lender also secured the right to appoint a board observer, reflecting the strategic nature of this partnership.
Seaport Global Securities LLC acted as the exclusive financial advisor and sole placement agent for this transaction, helping Acreage navigate the complexities of the deal and ensuring a smooth transition.
With this new financing arrangement, Acreage is well-positioned to strengthen its retail presence and pursue further expansion in the rapidly growing cannabis market.
