Aphria closes US $300m private placement

Aphria has closed its offering of 5.25% convertible senior notes due 2024 for gross proceeds of US$300 million in a private placement to qualified institutional buyers.

On April 23, 2019, the initial purchasers exercised their option to purchase up to an additional US$50 million principal amount of notes in full, resulting in gross proceeds of US$350 million.

The sale of the additional notes to the initial purchasers is expected to settle on April 26, 2019, subject to the satisfaction of customary closing conditions.

Aphria intends to use the net proceeds from this offering to support its international expansion initiatives, for future acquisitions and for general corporate purposes, including working capital requirements, in jurisdictions where federally and nationally legal.

The notes are senior unsecured obligations of Aphria and will accrue interest at a rate of 5.25% per year, payable semiannually in arrears on June 1 and December 1 of each year, beginning on December 1, 2019. The notes will mature on June 1, 2024, unless earlier repurchased, redeemed or converted.

The initial conversion rate for the notes will be 106.5644 common shares of Aphria per US$1,000 principal amount of notes (which is equivalent to an initial conversion price of approximately US$9.38 per common share).

Conversions of the notes will be settled in cash, common shares of Aphria or a combination thereof, at Aphria’s election. The initial conversion price represents a conversion premium of approximately 20% over the sale price of US$7.82 per common share of Aphria on the New York Stock Exchange on April 17, 2019, the last reported trading day prior to the announcement of the pricing of the notes.Cannabis Business Worldwide

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