Choice Consolidation closes $150M (U.S.) IPO
CHOICE CONSOLIDATION Corp. has closed its initial public offering of 15 million Class A restricted voting units of the corporation at an of f e ring price of $10 (U.S.) per Class A restricted voting unit, for aggregate proceeds of $150-million (U.S.). The corporation has granted the underwriters a 30-day option following closing of the offering to purchase up to an additional 2.25 million Class A restricted voting units, at a price of $10 (U.S.) per Class A restricted voting unit for additional aggregate proceeds of up to $22.5-million (U.S.) to cover overallotments, if any, and for market stabilization purposes.
“We are thrilled to make our public market debut on the NEO Exchange as we begin our next phase of effecting our qualifying transaction with a focus on U.S. cannabis acquisitions,” said Joe Caltabiano, chief executive officer of the corporation. “As a senior listing exchange, NEO has established itself as a leading platform for special purpose acquisition companies. We chose to partner with them due to their stringent listing requirements, which we believe provide increased transparency to both retail and institutional investors.
“Over the coming months, we look forward to effecting a transaction that will seek to create a best-in-class cannabis MSO operating across key limited-licence markets in the U.S. This management team and board of directors have a proven track record with more than 25 cannabis acquisitions completed over the past two years that have led to value creation for shareholders and we are looking forward to building another scaled and profitable MSO, this time with an even deeper understanding of what it takes to generate excellent cultivation yields, streamlined manufacturing and a differentiated retail experience for patients and customers.”
Each Class A restricted voting unit comprises a Class A restricted voting share and one-quarter of a share purchase warrant of the corporation. Each whole warrant will entitle the holder to purchase one Class A restricted voting share for a purchase price of $11.50 (U.S.), commencing 65 days after the completion of the qualifying transaction and will expire on the day that is five years after the closing date of the qualifying transaction or earlier.
The corporation intends to target existing strong single-state cannabis operators in markets with high barriers to entry, distressed assets that require minimal to moderate incremental capital to turn on and paper licences in targeted states that can be obtained on accretive terms.
The corporation’s management team and board of directors comprises Joe Caltabiano (chief executive officer and a director), Lois A. Mannon (chief financial officer), Peter Kadens (lead director) and Lisa Gavales (a director).
The sponsors of the corporation are Choice Consolidation SM Sponsor LLC and Calti Choice Sponsor LLC. Concurrent with the closing, the sponsors purchased an aggregate of five million share purchase warrants at an offering price of $1 (U.S.) per sponsors’ warrant for aggregate proceeds equal to $5-million (U.S.). The sponsors each own 2,156,250 Class B shares of the corporation and 2.5 million sponsors’ warrants, each representing a 50-per-cent interest in the Class B shares and approximately 10 per cent of the total Class A restricted voting shares and Class B shares, assuming full exercise of the overallotment option and no relinquishment by the sponsors of any of their Class B shares.
In addition, Senvest Master Fund LP and Calti Choice Consolidation LLC committed $30-million (U.S.) and $7.5-million (U.S.), respectively, of non-redeemable capital through the purchase of three million Class A restricted voting units (representing approximately 17.4 per cent of the outstanding Class A restricted voting shares and approximately 13.9 per cent of the total Class A restricted voting shares and Class B shares, assuming full exercise of the overallotment option) and 750,000 Class A restricted voting units (representing 4.3 per cent of the outstanding Class A restricted voting shares and 3.5 per cent of the total Class A restricted voting shares and Class B shares, assuming full exercise of the overallotment option), respectively, under the offering. Senvest Management LLC has an interest in Choice Consolidation SM Sponsor and in Senvest Master Fund. Calti Choice Sponsor and Calti Choice Consolidation are controlled by Mr. Caltabiano.
We seek Safe Harbor.
Matt Falk condensed this news release (email@example.com).
Joe Caltabiano, Lisa Gavales, Peter Kadens
(CDXX) Shares: 15,000,000