Curaleaf Borrows $425M For Five Years To Refinance Existing Debt

Curaleaf Holdings, Inc. CURA CURLF reported Monday that it has obtained commitments for a private placement of 8.0% senior secured notes due 2026 for total gross proceeds of $425 million.

"We are pleased to announce what we believe is the largest debt financing of any publicly-traded MSO to date," Joseph Bayern CEO of Curaleaf stated. "This offering will allow us to refinance our existing debt at a materially lower interest rate and provides us with additional financial flexibility to execute our strategic growth initiatives. While this initial offering provides more than enough liquidity to refinance our existing debt and meet current needs, the new Indenture provides us a new degree of flexibility to raise debt financing to ensure we have ample liquidity to meet our needs now and into the future."

The Debt Financing Details

The notes, which will be issued at 100% of face value, will be senior secured obligations of the company and will bear interest at a rate of 8.0% per annum, payable semi-annually in equal installments until the maturity date unless earlier redeemed or repurchased.

They will be governed by a trust indenture to be entered into on closing of the offering. The indenture enables Curaleaf to issue additional notes on an ongoing basis as needed, permitting up to an additional $200 million of senior bank financing.

The company plans to use the net proceeds from the offering to refinance existing indebtedness, for working capital, and to pay transaction fees and expenses. The offering is expected to close on December 15, 2021, subject to customary closing conditions.

Seaport Global Securities LLC and Canaccord Genuity Corp. acted as placement agents for the notes in the United States and Canada, respectively.

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Price Action

Curaleaf’s shares closed Monday market session 3.89% lower at $9.13 per share.

Photo: Courtesy of Andre Taissin on Unsplash