Cannabis MSO Ascend Wellness raising $7 million in private placement

Cannabis multistate operator Ascend Wellness is planning to raise $7 million in a private placement offering.

According to terms of the equity financing, the New York-based MSO intends to sell 9,859,155 shares of Class A common stock for $0.71 per share to an existing debt and equity investor.

Ascend intends to use the proceeds for potential acquisitions of debt or equity in certain marijuana companies or for taking over assets as part of its ongoing rollup strategy, according to a news release.

“We are seeing a lot of attractive acquisition opportunities that Ascend believes could be significantly accretive,” CEO John Hartmann said in a statement.

“The private placement strongly positions Ascend to act strategically and our decision to issue equity at these prices reflects our existing investor’s utmost confidence in Ascend and our potential acquisition strategy.”

In April, Ascend closed a $19 million cash-and-stock deal to acquire Devi Holdings’ four medical marijuana dispensaries in Maryland, which launches adult-use sales July 1.

Hartmann, who previously served as president at BuyBuy Baby and chief executive at True Value, was appointed Ascend’s CEO in May as part of a C-suite and board shake-up.

“Ascend is transitioning from a founder-led management team to a professional-led organization,” founder and Chair Abner Kurtin said in a statement at the time.

In the first quarter of this year, Ascend recorded net revenue of $114.2 million, up 34.2% year-over-year.

The company posted a net loss of $18.5 million, compared with a net loss of $27.8 million in the first quarter a year ago.

Ascend ended the quarter with $73.3 million in cash and net debt of $250.8 million.

Source: https://mjbizdaily.com/cannabis-mso-ascend-wellness-raising-7-million-in-private-placement/