High Tide Secures $25M Revolving Credit Facility With ATB Financial, Provides Debt Status Update

Retail-focused cannabis company High Tide Inc. HITI (NASDAQ: HITI) 2LYA announced Monday that it has entered into a credit agreement to establish a $25 million revolving credit facility with ATB Financial.

"We are extremely pleased to finalize this facility today,” Raj Grover, president and CEO of High Tide stated. “We know that our shareholders have been looking forward to us securing non-dilutive financing from a leading Canadian bank, and this is also something that we have been working on for some time as we believe that it provides validation of our improved financial profile. This is great news for our shareholders as this credit facility provides us with the firepower to continue our business growth and acquisitions of quality businesses, which are synergistic with our overall ecosystem, while limiting the dilution of our existing shareholder base.”

The Credit Facility Details 

The total $25 million consists of an initial $10 million limit and $15 million accordion (the “facility”), with an expected interest rate of less than 6% per annum.

The facility, which will become effective by end of business on Monday, will consist of senior secured prime rate loans, U.S. base rate loans, LIBOR loans, letters of credit, Bankers' Acceptances and a corporate MasterCard. It has an initial term of three years and provides High Tide, upon completion of customary conditions, with access to an initial $10 million in capital that can be drawn down at High Tide's discretion - subject to satisfaction of certain conditions - will provide High Tide with access to an additional $15 million in capital.

High Tide anticipates clearing customary conditions for the first draw by the end of its fiscal year ending October 31, 2021.

Proceeds from the facility are expected to be used to finance acquisitions as well as working capital and for standard corporate practices.

Debt Status Update 

In addition, High Tide also revealed that a further $1 million of debt has been converted into equity, which brings the company's total outstanding debt balance to $27.4 million as of Oct. 18. Of this amount, only $1.6 million matures during the next 12 months.

More recent news from High Tide: 

High Tide's Canna Cabana Receives License To Operate In British Columbia

High Tide Reaches U.K. CBD Market Via Acquisition of Blessed CBD For $12.32M

High Tide Confirms Inclusion In Fourth Cannabis ETF Since Its NASDAQ Debut

High Tide's Canna Cabana Milestone: Opens 100th Cannabis Dispensary, Big Plans For 2022

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Photo: Courtesy of CNW Group/High Tide Inc