Adam JacksonAscend Wellness Holdings (CSE: AAWH.U) (OTCQX: AAWH) closed a $15 million private placement of senior secured notes.
The notes carry a 12.75% interest rate and mature in 2029, the company said in a Tuesday news release. They were issued at 97% of face value and join an existing $235 million debt offering completed in July, which was dubbed one of the largest debt deals in legal cannabis ever.
The new funding comes shortly after the company’s losses more than doubled to $28.3 million in the third quarter of 2024 versus the previous year, while sales increased just 0.3% to $141.6 million.
The company, which runs grows and retail stores across seven states, cut its sales forecast in August, citing tougher competition in “select” markets. It had originally projected 12-15% revenue growth for the year.
In recent months, Ascend has brought in new leadership, with Sam Brill stepping in as CEO and Roman Nemchenko as CFO, following the August departure of CEO John Hartmann. The new executives started a cost-saving program aimed at cutting $30 million in yearly expenses, including reducing office and store staff.
The company said it plans to use the proceeds of this latest funding for “general corporate purposes, including to fund growth initiatives.”
Seaport Global Securities LLC handled the financing arrangements.
The notes are backed by “substantially all assets” of Ascend and certain subsidiaries, the company said. Terms allow investors to be repaid at par through July 2026.
The notes were offered privately in Canada and the U.S. to qualified institutional buyers and accredited investors, subject to a four-month holding period under Canadian securities laws, according to the news release.
