Xebra Brands Ltd. (CSE:XBRA) (OTCQB:XBRA) is looking to raise $150,000 through a private placement while settling $450,000 in debt, the company announced late Tuesday.
The company said it will issue up to 3 million units priced at 5 cents each, with each unit containing one common share and a half-warrant exercisable at 10 cents for two years.
The debt settlement involves issuing up to 9 million shares to company insiders and service providers at the same 5-cent valuation.
Last year, Xebra said it completed its first manufacturing run of Elements CBD products through Restorative Botanicals, aiming to import them into Mexico through its subsidiary once permits are granted. The company previously secured a distribution deal with ICAN Pharmacies FADERMEX to sell the products across seven pharmacy locations. The company previously secured a unanimous Mexican Supreme Court decision supporting its cannabis operations there in 2021.
“By focusing on strategic partnerships and accretive M&A in both the U.S. and Mexico, along with our robust commercial activities, we are well-positioned to capitalize on the significant opportunities in the CBD market in Mexico ahead of legalization,” Rodrigo Gallardo, interim CEO of Xebra Brands, said in a news release last summer. “Our dedicated team is working tirelessly to ensure that Xebra’s Elements brand becomes a household name, delivering exceptional products that meet the highest standards of quality and consumer satisfaction.”
The company, which claims exclusive rights to produce and sell cannabis products (containing less than 1% THC) in Mexico, projects the country’s cannabis market could reach $3.2 billion by 2026, with CBD sales accounting for $210 million, according to company market research citing Statista Market Insights data.
Xebra around that same time tapped veteran consumer goods executive Melise Panetta and her consulting firm. Panetta, who held senior roles at PepsiCo and SC Johnson, brings cannabis industry expertise including work with Keef Colas and High Times brands, according to the company.
Company officers and directors are expected to participate in both deals, which require Canadian regulatory approval. Xebra indicated it would use proceeds for working capital and general corporate purposes. The company aims to close both deals by Jan. 30.
[[{“value”:”The company plans to use the proceeds to ramp up production of its Elements CBD line.
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