In its bid to raise $6.0 million to repay debt and for general working capital, PharmaCan Capital Corp. (TSX-Venture: MJN) said that it closed the first tranche of a non-brokered private placement, grossing $2.0 million in the raise. The Toronto-based merchant bank, which focuses on investing in companies licensed to grow medical marijuana under Canada’s Marihuana for Medical Purposes Regulations, originally aimed to raise $5.0 million, but on Monday disclosed that figure has been upped to $6.0 million.
PharmaCan’s portfolio of holdings includes ownership in five of the 27 companies licensed by Health Canada to legally produce medical cannabis. In total, the company has a stake (or a potential stake) in: In The Zone (100%); The Peace Naturals Product (27%); Whistler Medical Marijuana Company (21.5%); ABcann (6%); Hydropothecary (1.9%); Vert Medical (agreement to acquire up to 33%); and Evergreen Medicinal Supply (agreement to acquire up to 25%).
In the initial tranche, PharmaCan placed 10.8 million share units, comprised of one common share of MJN and a warrant to purchased an additional common share for C$0.245 during a five-year period. Shares of MJN closed trading Friday at 21.5 Canadian cents.
Per the new increased offering, PharmaCan may issue up to 32.43 million share units related to the raise of $6.0 million.
Additionally, the company said that, effective immediately, Michael Gorenstein will replace Paul Rosen as President, CEO and Corporate Secretary. Gorenstein was already serving as Vice Chairman of PharmaCan and assumes the positions following the resignation of Rosen, who held the top executive position for three years and is reported to continue with the company in a consulting capacity.
PharmaCan independent director Michael Krestell said in a statement announcing the changes that Gorenstein’s leadership will “foster strategic clarity and ensure disciplined execution as CEO.”
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