Sundial shares slump premarket after Canadian cannabis company unveils latest dilutive capital raise
Sundial Growers Inc. shares sndl[ slid 16% premarket after the Canadian cannabis company announced its latest dilutive capital raise and said it has fully used up a shelf registration. Calgary-based Sundial, a now penny stock of a company that once had a valuation of $1 billion, said it priced a best efforts underwritten registered offering of 60.5 million Series A units, comprised of one common share plus one-half Series A Warrant — each whole warrant entitles the holder to buy one common share — plus 14 million Series B units, consisting of one pre-funded Series B Warrant (together with the Series A Warrants, the “Warrants”) to purchase one common share and one-half Series A Warrant, with each whole Series A Warrant entitling the holder to purchase one common share. The Series A unit will be priced at $1 per unit, while each Series B unit will be priced at $1 per unit, minus $0.0001, and the remaining exercise price of each Series B Warrant will equal US$0.0001 per common share. The exercise price of the Series A warrants will be $1.10 per share. Sundial shares closed Monday at $1.21. Sundial is expected gross proceeds from the offering of $74.5 million. Canaccord Genuity is sole bookrunner on the deal. Sundial’s U.S.-listed shares have gained 633% in the last three months amid a broad rally in the cannabis sector on hopes the administration of President Joe Biden will bring reforms to the sector. The stock is up just 0.8% in the last 12 months, while the Cannabis ETF THCX,
