Marijuana industry real estate investment trust Advanced Flower Capital, also known as AFC Gamma, is planning an initial public offering on the Nasdaq exchange that’s intended to raise $94.4 million to $105.6 million.
The offering would involve the sale of 5,555,555 shares of common stock in AFC Gamma, or roughly 47% of all the company’s common stock, at a price of $17-$19 per share, according to a prospectus dated Feb. 2.
An over-allotment option would offer up to 833,333 shares that are additional
“Due to the capital constrained cannabis market which does not typically have access to traditional bank financing and faces limitations on accessing equity markets, we believe we are well positioned to become a prudent financing source to established cannabis industry operators given our stringent underwriting criteria, size and scale of operations and institutional infrastructure,” AFC Gamma noted in the prospectus.
The company had roughly $92.5 million in outstanding loans to eight borrowers as of Dec. 26, with commitments “to approximately $19.8 million in additional loans and commitments from existing loans, with approximately $485.2 million of potential loans actively under review in our pipeline,” according to the prospectus.
AFC Gamma expects to net approximately $91 million from the IPO, or as much as $105 million if the over-allotment option is fully exercised, based on an $18 IPO price.
The company would use the proceeds to repay borrowings that are outstanding investment its present $19.8 million loan commitments and originate new loans and for working money along with other basic business purposes.
AFC Gamma raised $80 million for loans August that is last loaned $22 million to Pennsylvania-based natural treatments in November.
The company’s proposed Nasdaq expression will be AFCG.