Cannabis Wheaton (TSX Venture CBW), a Vancouver-based company innovating a new cannabis supply and investor model, will raise $35 million through convertible debentures. The money will be used to fund its partners—cannabis producers around the globe—to achieve their cultivation and brand-building business goals.
Cannabis Wheaton invests in a wide range of cannabis producers, building supply agreements into each deal. With multiple production sources reducing the risk of production problems from any one source, it sells its supply to large customers needing guaranteed product, such as medical clinics, pharmacies, government purchasing agencies and other potential distribution channels. It currently has over 15 production partners, which it calls “streaming” partners.
This diversified model reduces risk for both very large cannabis customers, and for ordinary investors, who can invest in a diversified collection of cannabis producers instead of focusing on one producer.
Large clients purchase supply contracts from Wheaton without having to put “all their eggs in one basket.”
MMCAP International, the lead subscriber to the debentures, has agreed to purchase $28 million of the debentures. The debentures will be convertible into common shares up until the maturity date of June 30, 2018. Before conversion, they will pay 8% interest.
Source: Wheaton Cannabis