Alberta-based Simply Solventless Concentrates Ltd., (TSXV : HASH), announced a package of convertible debentures financing worth $5 million on Tuesday. This included a $3 million investment lead from Plaza Capital.
This financing is primarily to fund the cannabis producer’s previously announced purchase of Delta 9 Bio-Tech Inc. which should close early in February. The acquisition is part of a growth strategy which saw Simply Solventless make three acquisitions by 2024.
Simply Solventless expects to report January revenues of about $4.5 million. This excludes revenue from the Bio-Tech acquisition. It extends a growth streak that saw fourth-quarter 2024 revenue reach C$11.8 million – a 556% increase from the same period the previous year.
In addition, the company plans to introduce 25 new cannabis products on Alberta’s and Ontario’s recreational markets between February and April.
Jeff Swainson is the president and CEO of Simply Solventless. He said, “We wanted to maximize our earnings per share by funding the Biotech acquisition with a method that would limit dilution.” The financing includes a warrant exercise price and conversion price per share of $1.20. These represent premiums of 36% and 30% respectively over the recent average trading price for the company.
The company says that the debenture bonds have an interest rate of 11% per year, payable every quarter. They will mature after 48 months. The company says that each $1,000 unit comes with warrants which can be exercised into $1.20 shares over a 4-year period.
Simply Solventless is expanding its product line to include infused blunts and pre-rolls. The new products will be available under the Astrolab, Frootyhooty and Lamplighter brands.
The company plans to launch a variety of cannabis-infused products, including “Moon Dusted”, infused prerolls with various flavors and live rosin, as well as diamond-coated blunts. Frootyhooty is also planning to launch cannabis-infused drinks.
The financing is subject to TSX Venture Exchange. Simply Solventless has stated that a binding agreement is not finalized, and this transaction could end differently than described.