RIV Capital Fetches $6.5M Upon Termination Of PharmHouse's CCAA Proceedings, Will Secure $150M Via Deal With ScottsMiracle-Gro Subsidiary

Cannabis-focused investment and acquisition company, RIV Capital Inc. RIV CNPOF disclosed Monday that it has received roughly $6.5 million and that termination of PharmHouse Inc.'s proceedings under the Companies Creditors Arrangement Act and PharmHouse's assignment into bankruptcy under the Bankruptcy and Insolvency Act is expected soon.

The receipt of the cash remaining in PharmHouse - RIV Capital's 49%-owned Ontario-based joint venture to which the company was entitled, concludes its relationship with PharmHouse.

In March, PharmHouse opted to sell its greenhouse facility alongside certain equipment. Once the Ontario Superior Court of Justice approved the PharmHouse sale, RIV Capital paid $25 million to the lender of PharmHouse's $90 million non-revolving syndicated credit facility. Following the closing of the PharmHouse sale, the company paid an additional $7.5 million to the lenders to satisfy its obligations under the PharmHouse credit facility.

In addition, earlier this year, the company also settled a CA$17.6 million ($13.9 million) tax liability related to the capital gains realized on the transaction between RIV Capital and Canopy Growth Corporation CGC WEED that was wrapped up in February 2021. The Canadian cannabis giant gave up on its interest in Canopy Rivers earlier this year. The Toronto-based cannabis-focused venture capital firm transferred three of its portfolio assets to Canopy Growth for $115 million in cash and 3.75 million of Canopy Growth's common shares in exchange.

In the meantime, RIV Capital disclosed that it is securing some $150 million in financing through a deal with ScottsMiracle-Gro Company's SMG newly created cannabis-focused subsidiary. The Hawthorne Collective closed the purchase of an unsecured convertible note from RIV Capital in August. RIV Capital plans to use proceeds for general corporate and other lawful purposes that will help accelerate the launch and expansion of its U.S. cannabis operating and brand platform.

Photo: Courtesy of Austin Distel on Unsplash