Cannabis company Aphria Inc. (TSE: APHA) said late last week it has negotiated private agreements with non-Canadian holders of its convertible bonds to repurchase approximately $90.8 million in bonds for approximately 18.7 million ordinary shares and approximately $2.1 million in cash for accrued and unpaid interest.
The Ontario-based company agreed to repurchase a portion of its bonds at a 25% discount on their face value, with shares issued at a premium of 31% at Aphria's most recent closing market price, equivalent to a conversion price. $ 4.84 per share.
The purpose of the transaction is to reduce the company's debt and eliminate $ 4.8 million in annual cash interest costs.
The issuance represents a 7.2% dilution to current stockholders.
This transaction strengthens the company's balance sheet by increasing its net cash position from CA$36.3 million at the end of the quarter to CA$163.8 million.