Toronto, Canada-based Flora Growth Corp., which cultivates cannabis in Colombia, began trading yesterday on the U.S. Nasdaq Capital Market with an initial public offering of 3,333,333 shares at $5.00 per share. The IPO is expected to raise $16,666,665, the company said.
The company is trading under the “FLGC” symbol.
Flora’s cultivation business in Colombia is wholly outdoors, which costs just 6 cents per gram to operate, while indoor cultivation in North America runs about $1.25, CEO Luis Merchan said in an interview with CNN Business.
“We have robust cultivation facilities and we intend to use capital from the stock sale to expand our operations in the US, infrastructure in Colombia and sales team worldwide.” – Merchan to CNN
The firm reported $106,000 in revenue last year and is not yet profitable but Merchan said the firm would make money as a low-cost cannabis producer. He indicated the company is focused on edibles and personal care products rather than recreational-use products, such as pre-rolls. Flora has a partnership with 2014 Miss Universe and former Miss Colombia, Paulina Vega, to sell CBD-infused skincare products.
In their F-1 filing, Flora said it will “require the funding from this offering to begin to plant, grow and harvest our cannabis products on a commercial scale, to produce oil extracts, to access needed facilities and labor and to achieve large channel distribution of our products,”
Shares of the company fell 4.2% by the close of markets on Tuesday but gained 2.3% in pre-market trading. The IPO is expected to close on Thursday.
Boustead Securities, LLC acted as the sole underwriter for the offering with MKM Partners acting as co-manager.
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