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by Stockwatch Business Reporter
The S&P/TSX Cannabis Index added a fraction to 40.43, while the CSE Composite Index added 5.41 to 279.80. Canadian cannabis grower Canopy Growth Corp. (WEED) lost one cent to $3.35 on 6.94 million shares, after eliminating about $263-million worth of debt through a previously announced shares-for-debt swap. The deal saw it issue a total of 76.8 million shares at an average of about $3.42.
Investors remained as unenthused as ever. Canopy announced the swap less than three weeks ago, during which time the stock tumbled to around $3 from $4.50. Considering that the debt in question bore interest at just 4.25 per cent -- a highly favourable rate in the cannabis industry -- investors and analysts questioned why Canopy should want to pursue a swap at a multiyear low in the stock price, causing significant dilution. (While Canopy did part of the swap at a fixed price, the rest depended on subsequent market prices, which as noted above fell rapidly.)
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