HempFusion Wellness Inc (TSX:CBD.U), a leading US health and wellness CBD company, announced on Tuesday that it has completed its initial public offering (IPO) to raise US$17 million and has started trading on the big board in Toronto.
The company rounded out its US$17 million IPO by offering 7 million shares at a price of US$1.00 per share to raise gross proceeds of US$7 million and 10,000,000 units at the offering price per unit for gross proceeds of US$10 million.
HempFusion’s shares and share purchase warrants of units and share purchase warrants issued in connection with the company’s offering of units completed in August 2019 will now start trading on the Toronto Stock Exchange under the following symbols: CBD.U for the common shares; CBD.WT.V for the warrants; and CBD.WT.U for the 2019 warrants.
“We are incredibly excited to have completed our initial public offering and begin trading on the Toronto Stock Exchange,” HempFusion Wellness co-founder and CEO Dr Jason Mitchell said in a statement.
“The additional US$17 million in capital adds to our healthy treasury, providing us with a solid foundation to build from and execute on our strategic plans for 2021 and beyond.”
The company enjoys high visibility as its family of brands — HempFusion, Probulin Probiotics, Biome Research, and HF Labs — are widely distributed to around 4,000 retailers spread across all 50 states in the US and select international locations.
In addition, HempFusion’s wholly-owned subsidiary Probulin Probiotics, is one of the fastest-growing probiotics companies in the United States, according to data technology company SPINS.
“Our goals include increased investment into research and development, expanding our sales and distribution networks, and firmly establishing HempFusion as a leader in the dynamic global CBD industry,” added Dr Mitchell.
The offering was completed through a syndicate of agents led by Canaccord Genuity Corp, as sole bookrunner, and including Haywood Securities Inc and PI Financial Corp.
The company said each unit offered under the unit offering consists of one share and one-half of one warrant. Each warrant entitles the holder to purchase one share at a price of US$1.20 per warrant share at any time until January 6, 2026.
The unit shares are subject to a hold and may not be sold or traded until May 6, 2021. The warrant shares will also be subject to a hold and may not be sold or traded until July 6, 2022. Separately, the exercise price of the 2019 warrants, each of which is exercisable to acquire one share was subject to adjustment based on the offering price and has now been confirmed at US$0.85 per 2019 warrant share. These 2019 warrant shares will be subject to a hold and may not be sold or traded until July 6, 2022.
The company has granted the agents an over-allotment option exercisable in whole or in part, at any time for a period of 30 days after the closing of the offering, to purchase up to an additional 1,050,000 shares and 1,500,000 units, for additional gross proceeds to the company of up to US$2,550,000.
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