Australia's Cann Group Ensures $50M Loan To Support Facility Completion

Australian cannabis company Cann Group Limited CANN CNGGF revealed Monday it has obtained credit approval from National Australia Bank (NAB) for its $50 million secured debt facility.

Cann Group plans to finalize the administration of the documentation required with National Australia Bank during December.

The loan — a construction facility — will be used to support the ending of the first stage construction of the company’s state-of-the-art medicinal cannabis manufacture site close to Mildura. The first stage should last around 9 months, and recommence in February, while the first products are projected to be released by March 2022.

Cann Group noted that the first stage of the project should enable the production of 12,500 kilograms of dry flower equivalent per year, and upon commissioning, the facility should yield 130 new job openings.

The first stage is estimated to cost a total of $112 million, of which $53 million Cann Group has already spent, and the rest $59 million will be provided thorough the new bank loan facility and existing cash, as the company already received a $1.95 million grant from a Victorian Government Development in July.

“The commissioning of production at Mildura is an important step in Cann’s plan to produce GMP certified medicinal cannabis at scale,” Cann Group CEO Peter Crock said. “The facility will utilise world-leading technology, providing Cann with a globally competitive unit price based on substantial economies of scale. Securing the support of a tier one bank is a strong validation of our strategic growth plans. Given the building demand for our products, we have the confidence to immediately ramp up production as soon as the facility is ready.”