Aphria's subsidiary Aphria Diamond secured a credit facility, on November 29 2019, with a major Canadian chartered bank (the “Bank”) as sole arranger, sole book runner and administrative agent on behalf of a group of lenders for a committed senior secured credit facility of $80 million.
“Aphria has the largest cash balance in the cannabis industry without the dilution of a strategic partner,” said Irwin D. Simon. “We are pleased to have secured a term loan that will repatriate a portion of our investment in Aphria Diamond, to be strategically deployed by Aphria. This loan strengthens our balance sheet without being dilutive, and positions Aphria Diamond for success as we expand into new categories and growth opportunities in cannabis to enhance value for shareholders long term.”
"Since securing its Health Canada license on November 1, 2019, Aphria Diamond is quickly coming on scale," the team with the company explains. "Aphria Diamond will be 70 per cent planted by mid-week, with 350,000 young seedlings planted. With the level of automation and scale of the facility, the Company anticipates Aphria Diamond to have one of the lowest cost structures in the industry. Aphria expects the dried flower production from the first harvest to be sold to provincial control boards sometime in March 2020."
"The Credit Facility is secured by Aphria Diamond’s assets and Aphria’s balance sheet. Pricing is based on a set margin over the Bank’s Canadian Prime Rate or Bankers’ Acceptance and a pricing grid linked to certain financial ratios. It is expected to be at the outset in the low-to-high 5 per cent per annum range. The Credit Facility has a three-year term and contains customary financial and restrictive covenants," they conclude.
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