Green Thumb Industries Inc. issued $105 million (U.S.) of senior secured bonds, becoming one of the first cannabis companies to tap the debt markets.
The firm issued the three-year securities at an interest rate of 12 per cent, according to a statement Thursday. That’s above the 9.9 per cent yield in a Bloomberg Barclays total return index of U.S. high yield debt, rated CCC and excluding financials.
Cannabis companies have been equity market darlings as investors bet legalization of recreational marijuana will spread around the world following Canada’s move last October. Their ability to issue straight bonds has been more limited as most firms aren’t cash flow positive and banks are reluctant to arrange deals with the drug still illegal at the federal level in the U.S.
However, there have been some convertible issues, including from Canopy Growth Corp., Aurora Cannabis Inc. and Tilray Inc. — the