OGI - $69B Tobacco Giant Supports Cannabis With $91M Investment In Toronto Weed Producer | Benzinga
Canadian cannabis company Organigram Holdings Inc. (NASDAQ: OGI) (TSX: OGI) announced on Monday a CA$124.6 million ($91.2 million) follow-on strategic equity investment from BT DE Investments Inc., a wholly-owned subsidiary of tobacco giant British American Tobacco p.l.c (BAT) (LSE: BATS) (NYSE: BTI).
What Happened
Subject to the receipt of certain regulatory approvals, approval from Organigram’s shareholders and other conditions, BAT will subscribe for 38,679,525 shares for CA$3.2203 per share, for gross proceeds of CA$124.6 million across three tranches.
The majority of the CA$83.1 million will be used by Organigram to create a strategic investment pool, named Jupiter. The remainder of CA$41.5 million of the investment will be used for general corporate purposes.
Why It Matters
Jupiter will target investments in emerging cannabis opportunities that will enable Organigram to apply its industry-leading capabilities to new markets.
Management has identified that geographic expansion is a strategic priority and this opportunity presents Organigram with the capital to lay global foundations as the legal recreational cannabis market continues to see significant growth.
"Jupiter, the strategic investment pool, is expected to accelerate Organigram’s ambitious growth plans, enabling further geographic, technological, and product expansion,” Beena Goldenberg, ...