Cronos Cannabis Co. Will Provide $51M To GrowCo Toward Facility Expansion Fund
Cronos Group Inc. (NASDAQ:CRON) (TSX:CRON) announced on Thursday the expansion of Cronos Growing Company, a cannabis cultivation business of which the Toronto-based company owns 50%.
What Happened
The investment will be funded by a roughly $51 million (CA$70 million) secured non-revolving credit facility provided by Cronos. It will assist GrowCo’s expansion of its purpose-built cannabis facility in Leamington, Ontario, that will produce high-quality cannabis flower, the company said in a press release.
The interest rate under the credit facility is equal to the Canadian Prime Rate plus 1.25% and is payable quarterly. Cronos noted GrowCo is not obliged to start repaying the $51 million principal until the quarter after the commencement of sales from the newly constructed area.
In relation to the investment, the GrowCo board of directors will expand to five members, three of whom will be named by Cronos.
Additionally, the company …