Affinor Growers Inc., a Montreal-based company with a focus on how to grow crops that include cannabis at cheaper costs, agreed to sell shares at a slight discount in order to raise $3.1 million.
The company, that trades under the ticker (RSSFF) on OTC Markets QB platform as well as on the Canadian Stock Exchange and in Frankfurt, Germany, will sell 25 million shares at almost 13 cents a share, a discount off the 14.4 cents a share price on March 5, the day before the sale was announced.
The deal also includes the sale of two-year warrants good for the purchase of 25 million common shares at 19.7 cents a share each.
After opening at almost 15 cents a share, the cannabis stock has slid back to 13.6 cents a share on Tuesday's trading session. Over the last year, shares have been as high as almost 23 cents a share and as low as 4 cents a share.
In a statement about the financing, Affinor said it reserved the right to increase the size of the private-investment-in-public-equity (PIPE) issuance by an additional 25 million shares. The communication was mum on the investors in the transaction. Likewise, the company did not give a date as to when it believed the transaction might close.
The company's interim financials filed at OTC show $2.3 million in cash on hand as of Jan. 18, and a net loss of $28,915 on no revenues.
Affinor is focused on improving yields and cutting costs of crops, including cannabis, by using a vertical growing system. Last year, the company reported positive results in growing cannabis using the company's vertical method, increasing production by 200%.
The company brought in a new CEO, Nick Brustore, last month to replace Jarrett Malnarick. Brustore is one on the founders of the company and one of its largest shareholders.
Affinor tapped the PIPEs market once before, in 2015 when the company signed an equity line agreement with Dutchess Capital Management LLC, a consistent cannabis investor.
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