The extension deal will dilute the company’s existing share structure.
U.S. multistate operator AYR Wellness Inc. (OTCQX: AYRWF) announced it is close to finalizing a debt restructuring deal that includes its Canadian subsidiary, AYR Wellness Canada.
The Miami-based company is part of a plan of arrangement under Section 192 of the Canada Business Corporations Act.
The company will exchange its existing senior secured notes, which are due in December 2024 with a 12.50% interest rate, for new 13% senior secured notes due in December 2026. The new notes, with a principal amount of $243.5 million, will be managed by AYR Wellness Canada.
In addition, AYR Wellness will issue new subordinate voting shares and antidilutive warrants to holders of the new debt.
The deal will dilute the company’s existing share structure, but the move is a necessary step to balance immediate financial needs with long-term shareholder value, according to a statement from the company.
Additionally, AYR Wellness Canada will issue $50 million in additional senior secured notes, due in 2026. The completion of the restructure is targeted for Feb. 7, 2024.
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