Cresco Labs (CSE:CL) (OTCQX:CRLBF) (“Cresco Labs” or “the Company”), a vertically integrated multistate operator and the number one U.S. wholesaler of branded cannabis products, announced today the closing of an agreement with lenders to upsize its senior secured term loan (the “Senior Loan”) to an aggregate principal amount of US$400 million. The Senior Loan bears interest at a reduced rate of 9.5% per annum, with a maturity date of August 12, 2026.
The Company intends to use the proceeds from the Senior Loan to retire its existing US$200 million credit facility, fund capital expenditures, and pursue other targeted growth initiatives within the U.S. cannabis sector. The Senior Loan does not include any equity or convertible components and the total facility amount is being provided by a syndicate of five existing, institutional lenders.
“Today we have secured funding to capitalize on new growth opportunities, improved our cost of capital without diluting shareholders, simplified our capital structure, and given ourselves enhanced flexibility in a dynamic capital environment.” said Charlie Bachtell, CEO of Cresco Labs. “This agreement to extend and increase our Senior Loan reflects the unique value proposition that Cresco Labs has demonstrated and the confidence our investors have in our differentiated strategy.”
The terms of the Senior Loan were negotiated at arm’s length with the agent and lead investor and include customary restrictive covenants.
