CAN: Hexo to raise $140M to fund acquisition and expansion into the US

HEXO has announced the pricing of its previously announced overnight marketed public offering of units of the company. The underwriters for the offering have agreed to purchase 47,457,628 units at a price of US$2.95 per unit for total gross proceeds to the company of approximately US$140 million, before deducting underwriting commissions and offering expenses.

A.G.P./Alliance Global Partners and Cantor Fitzgerald Canada Corporation are acting as lead underwriters and joint bookrunners for the Offering, together with ATB Capital Markets Inc. which is acting as co-manager for the offering.

In addition, the company has granted to the underwriters a 30-day option to purchase up to an additional 7,118,644 units offered in the offering on the same terms and conditions.

"The company expects to use the net proceeds from the offering to satisfy a portion of the cash component of the purchase price payable to the Redecan shareholders on closing of the Redecan acquisition and for expenditures in relation to the company’s U.S. expansion plans," the Hexo team explains. "The offering is expected to close on or about August 24, 2021 and will be subject to market and other customary conditions, including approval of the Toronto Stock Exchange."