Multistate marijuana operator MedMen Enterprises has raised roughly $20 million of financing, with $11.7 million committed now, in a series of complex transactions with existing lenders and institutional investors.
The Los Angeles-based company said in a news release that the financing package is a “reflection of the commitment the company has made to strengthen the balance sheet, accelerate its path to profitability and sustainability, and focus on its core retail business.”
How well MedMen is doing in terms of that refocus will become more apparent when the company releases its full fiscal year results on Sept. 28.
MedMen slashed its work force and other operating expenses in late 2019 and has undergone leadership changes in efforts to strengthen its financial position.
It also has been fighting litigation and struggling to keep licenses in several key markets – in Virginia it lost its medical marijuana business license.
The financing commitments include:
- Up to $10 million of debt from certain institutional investors at 7.5% interest. The investors can convert the unsecured debt into subordinate shares of stock. An initial tranche of $1 million closed on Sept. 16, with subsequent tranches expected to close in the coming months, subject to certain conditions.
- $5.7 million in a senior, secured loan led by California-based Stable Road Capital at an annual interest rate of 18%.
- $5 million in senior secured debt with holders having rights to convert the debt into stock. That funding round was led by California-based Gotham Green Partners.