How Cann Group’s $15.3M Debt Restructure Sets Stage for Growth
Cann Group Limited has successfully completed a significant debt restructure and equity raising, improving its financial footing and liquidity to support future growth.
- Completed $15.3 million settlement with National Australia Bank
- Closed previous $70 million loan facilities
- Secured $14.45 million in new loans with defined terms
- Raised $9 million through a two-tranche equity placement
- Scheduled EGM to consider issuing options to equity participants
Debt Restructure Milestone
Cann Group Limited has announced the successful completion of a major debt restructure transaction, marking a pivotal moment in the company’s financial journey. The restructure involved settling $15.3 million with its major financier, National Australia Bank (NAB), and closing out previous loan facilities totaling $70 million. This move effectively releases the company from prior liabilities and associated securities, including property mortgages.
New Funding and Improved Liquidity
To fund the settlement and support ongoing operations, Cann Group secured new funding arrangements. This includes a $9 million private loan and a $5.45 million new loan bearing a 9.5% annual interest rate with additional capitalised interest and fees. These loans come with a two-year term and monthly payable interest, reflecting a structured approach to managing debt obligations.
Alongside debt restructuring, the company raised $9 million through a two-tranche equity placement, approved by shareholders at the recent AGM. This capital injection is designed to bolster near-term liquidity and provide a more sustainable capital structure, enabling Cann Group to focus on strategic priorities and operational performance.
Strategic Outlook and Shareholder Engagement
Chairman Mike Ryan highlighted the significance of this transaction, emphasizing its role in strengthening the balance sheet and supporting long-term value creation. The company remains committed to executing its strategic priorities with the backing of shareholders and lenders.
Looking ahead, Cann Group has scheduled an Extraordinary General Meeting (EGM) for December 23, 2025, where shareholders will consider the issuance of options to equity participants. These options, with a two-year expiry and exercise price of 1.46 cents, were also approved at the AGM and represent an additional mechanism to align stakeholder interests and incentivize performance.
Positioning for Growth in Cannabis Medicines
Cann Group operates in the pharmaceutical cannabis sector, developing and supplying innovative cannabis medicines from its facilities in Victoria. The company’s portfolio includes patented capsule technology through its subsidiary Satipharm, positioning it well within a growing market. The recent financial restructuring provides a more robust platform to support ongoing research, production, and market expansion.
Bottom Line?
With its balance sheet fortified and fresh capital in hand, Cann Group is poised to advance its strategic growth agenda amid evolving market opportunities.
Questions in the middle?
- What are the detailed repayment schedules and covenants attached to the new loans?
- How will the upcoming option issuance impact shareholder dilution and future capital structure?
- What operational milestones does Cann Group aim to achieve with its improved financial position?
