TerrAscend Corp. (TSNDF), a leading cannabis company, has successfully completed the second and final draw of $26 million from its $140 million senior secured term loan, originally announced in August 2024. This significant financial maneuver marks a strategic move for the company, allowing it to strengthen its financial position and advance its growth objectives.
The newly acquired funds will be allocated towards reducing high-interest debt, primarily in Michigan, where TerrAscend is actively expanding its presence. This move signifies a commitment to optimizing the company’s financial structure, ultimately enhancing its operational efficiency and long-term stability.
The $140 million loan, managed by FocusGrowth Asset Management, LP, carries a 12.75% interest rate and matures in August 2028. Notably, it has no prepayment penalties, providing flexibility and cost-effectiveness for TerrAscend. With this final draw, the company has now fully secured the loan, previously receiving an initial $114 million in August.
The loan is secured by TerrAscend’s valuable assets in Pennsylvania, California, Michigan, and certain entities in Maryland, demonstrating the confidence lenders have in the company’s future prospects. Ventum Capital Markets played a crucial role in the transaction, acting as the exclusive financial advisor.
This strategic debt management initiative underscores TerrAscend’s commitment to financial discipline and strategic growth. By reducing high-interest debt and extending its debt maturity profile, the company is well-positioned to navigate the dynamic cannabis industry landscape with greater financial flexibility and a stronger foundation for continued success.
TerrAscend’s shares traded at $1.26 per share at the time of writing on Tuesday evening, reflecting a 3.82% decline. This financial move is expected to have a positive impact on the company’s overall financial performance, enhancing its ability to invest in future growth opportunities and expand its operations.
