Unlike equity capital raises which are sharply lower in 2020, debt raises increased from $423M to $563M to $940M in 2018, 2019 and YTD 2020 respectively. Like M&A, debt has moved eastward. California, Colorado, Oregon, and Washington jointly made up 34.5% of 2018 debt but only 5.4% of 2020’s debt. Illinois, Massachusetts and New York accounted for 93.0% of 2020 debt issuance.
The average size of issues is going up from $10.0M in 2018 to $13.7M in 2019 to $55.3M in 2020.
The market has become focused on the larger players. Curaleaf ($300M), Leaflink($250M) , and Cresco ($175M) jointly made up 77.1% of 2020 debt issuance. Aside from these three names, the average issues size drops to approximately $16.5 million.
Viridian expects significant increases in debt issuance as the large MSOs build out new rec states employing the borrowing power of their burgeoining cash flow.
Show Notes: Viridian Capital Advisors’ Chart of the Week Cannabis Debt Financing is Booming Across the U.S. https://www.viridianca.com/chart1
Host: Josh Kincaid, Capital Markets Analyst & host of your cannabis business podcast. https://www.linkedin.com/in/joshkincaid/
Episode 611 of The Talking Hedge: Your Cannabis Business Podcast. Covering cannabis products, reviews, business news, interviews, investments, events, and more. https://www.theTalkingHedgepodcast.com
Music Info: Song: Dark Trap Beats Hard Rap Instrumental | Gang | 2018Artist: LuxrayBeats
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Josh is not an investment adviser. The Talking Hedge is long gold and silver. Listeners should always speak to their personal financial advisers.
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