The Green Organic Dutchman Holdings Ltd is “exploring non-bank debt financing alternatives such as issuing bonds or raising private loans” for its construction projects in Quebec, according to Sebastien Bouchard, Green Organic spokesman.
The company currently has construction projects that require additional funding. It announced on Wednesday, Oct. 9, that it is looking for financing options, including issuing bonds or private loans to raise money for the completion of construction facilities in Ancaster, Ontario, and Valleyfield in Quebec.
The firm’s decision to find alternative financing comes following unsuccessful talks for commercial bank facilities and equipment leasing.
“Due to changing market conditions, those sources of financing have been unavailable on acceptable terms within the timeframes required, leading the company to commence a review of additional alternatives,” the Toronto-based firm said in a statement.
Green Cannabis said that it may revise the construction schedule of its projects if it fails to secure the right financing.
Credit Financing In The Medical Cannabis Industry
The company has no outstanding debt. It also has $56.7 million in cash, $40.2 million of which is allocated for capital expenditure.
Stocks in the industry, however, are underperforming. Green Cannabis’ stock lost 27 percent of its value in 2019. On Wednesday, the value of its shares hit a record low of C$ 1.31, falling by as much as 24 percent from its most recent high recorded on March 19.
Credit financing is not yet widely available for hemp companies because most firms are still in the process of reaching positive margins out of their core businesses.
Canada-based cannabis companies, including Trulieve Cannabis Corp. and Green Thumb Industries Inc., turned to bonds, offering equity and convertible securities to finance their investments instead of relying on debt financing.
Producer Of Organically Grown Marijuana
Green Organic Dutchman Holdings Ltd is a Canada-based medical cannabis company supplying cannabis products to licensed producers and dealers within Canada.
The company holds a license from Health Canada to produce dried marijuana, marijuana plants, and fresh marijuana plants under the Access to Cannabis for Medical Purposes Regulations (ACMPR).
The company claims to be the only licensed producer in Canada that organically grows 100 percent of its cannabis products.