Fire & Flower Holdings (TSX: FAF) has seen Alimentation Couche-Tard (TSX: ATD.b) up its stake in the firm. As previously announced, the convenience store retailer has exercised certain warrants it held in the company, increasing its stake to 35.32%.
The transaction specifically saw Couche-Tard exercise 8.3 million Series B warrants it held in the company, pursuant to an arrangement it entered into with the cannabis retailer several years ago. The exercise brought in total gross proceeds of $37.8 million to Fire & Flower, with 6.7 million warrants exercised at $4.51 per share, and 1.6 million warrants exercised at $4.77 per share.
Much of those proceeds however were simply circled back to Couche-Tard. A significant portion of the proceeds were utilized to pay off a loan agreement between the two firms, whereby Couche-Tard had lent the company $20.0 million under a short term loan agreement entered into in December at a rate of 8.0% per annum.
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The remaining portion of proceeds from the exercise of warrants is to be used for working capital, general corporate purposes, and for further strategic initiatives.
Fire & Flower Holdings last traded at $3.56 on the TSX.
Information for this briefing was found via Sedar and Fire and Flower Holdings. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
