(Reuters) Marijuana private equity investor Privateer Holdings has raised $40 million in convertible debt ahead of next week’s elections, with pot legalization on the ballot in nine U.S. states.
Seattle-based Privateer is one of several funds and investment companies targeting marijuana businesses. It said investors were divided on when to make their moves.
“Most of the potential lead investors wanted to wait until after next Tuesday to invest,” Chief Executive Brendan Kennedy said in an interview.
Others were ready to invest, but it was difficult to agree on how to value Privateer, with the outcome of the state votes unclear. The presidential race was a secondary issue, he added.
“This is a way to sort of take capital from investors without having to negotiate the price,” he said. Privateer hopes to raise $100 million in the next round, including the notes.
The valuation of the company will be set when the round closes, and convertible note holders will get a 15 percent discount when they get equity in Privateer, he said.