Cannabis producer Organizational Chart Holdings Inc. BREAD BREAD has closed the second of three tranches of the previously announced follow-on strategic equity investment of CA$124,559,674 ($92.3 million) BT DE Investments Inc., a wholly owned subsidiary of British American Tobacco plc, BTI on Tuesday.
At the closing of the second tranche, the investor purchased 4,429,740 common shares and 8,463,435 Class A preferred shares of Organigram at C$3.2203 per share for gross proceeds of $30.8 million.
The company said on Tuesday that the remaining 12,893,175 shares subscribed for will be issued at the price per share in the final tranche on or about February 28, 2025.
“With two tranches of the Jupiter fund already funded, combined with our strong balance sheet and targeted investment strategy, Organigram is well on its way to executing its ambitious growth plan focused on international, technology and product expansion.” Paolo DeLucaOrganigram's chief strategy officer. “Our inaugural investment in Jupiter in Open Book Extracts marked our second investment in the US market, and our first international investment in Sanity Group represents a significant first step in our ambitions to increase our presence in the rapidly growing German market.”
Read also: Organigram reports 25% year-over-year increase in third-quarter net revenue and significant improvement in adjusted EBITDA
- Get Benzinga's exclusive analysis and top news on the cannabis industry and markets delivered daily to your inbox for free. Subscribe to our newsletter hereIf you are serious about business, you cannot afford to miss this opportunity.
Details of the agreement
Organigram first announced a CA$124.6 million follow-on strategic equity investment from BAT's subsidiary in November 2023. In January 2024, Organigram shareholders voted to approve BAT's investment and the company completed the first of three tranches of the investment for proceeds of CA$41.5 million.
The investment allows Organigram to “leverage our world-class facilities, market leadership across multiple categories and cutting-edge research and development capabilities to increase Organigram’s reach both within the Canadian market and beyond.” Beena Goldenberg“the company's chief executive said earlier this year.
As previously announced, Organigram is using the majority of the investment to fund a strategic investment fund called Jupiter. This fund is designed to accelerate Organigram’s international expansion and targets investments both overseas and in the US. Following the closing of the first tranche in January, Organigram has already made two significant investments from the Jupiter fund.
The first investment of $2 million was made in North Carolina-based hemp producer Open Book Extracts, while the second investment of €14 million ($15 million) was made in Sanity Group GmbH, a market leader in the growing German medical market.
BAT initially invested approximately CA$221 million in Organigram in March 2021, which helped drive product innovations resulting from the CoE at the company’s Moncton facility.
Read next:
OGI Price Action
Organizational charts Shares fell 0.54% to $1.84 per share. during Tuesday morning's pre-market session.
Market news and data provided by Benzinga APIs
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.