Cannabis giant Canopy Growth Corporation (TSX:WEED) (NASDAQ:CGC) has made an early payment of $100 million on its senior secured loan at a discounted price of $97.5 million. This move reduces the company's debt and saves around $14 million in annual interest costs, while highlighting its focus on financial discipline.
"This early prepayment reflects our ongoing commitment to reducing cash burn and strengthening our capital structure," stated Judy Hong, CFO of Canopy Growth. "Our proactive steps to reduce debt and extend maturity enhance our balance sheet flexibility to invest in growth areas and drive long-term value creation for our shareholders."
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As previously announced in August 2024, this prepayment was agreed to between the company and its senior lenders as part of a series of amendments to the term loan which, among other things, included an extension of the term loan's maturity date to Dec. 18, 2026. Under the loan amendment, Canopy Growth has the option to make an additional prepayment equal to $100 million at a discounted price of $97.5 million by March 31, 2025. If payment of the second prepayment is made, the maturity date of the term loan will automatically further extend to September 18, 2027.
The company's move to improve its balance sheet, comes on the heels of Canopy Growth's acquisition of top edibles brand – Wana, which generated roughly $150 million in retail sales across 19 states in 2023. The deal includes Wana Wellness, LLC, The CIMA Group, LLC, and Mountain High Products, LLC. The top edibles brand, Wana,
CGC Price Action
Canopy Growth shares traded 0.70% lower at $4.23 per share during Thursday's pre-market session.
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