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FSD Pharma Inc. (NASDAQ:HUGE) (CSE:HUGE) (FRE: 0K9A) has closed the sale of the company’s former cannabis processing facility located in Cobourg, Ontario, Canada, for gross proceeds of CA$16.4 million ($12.65 million) in cash.
The sale, completed on May 6, 2022, included a 26.1-hectacre parcel of land and 50,800 square-meter building, which FSD Pharma acquired in November 2017 for $5.5 million.
Net of commissions and fees, the sale netted approximately $15.48 million in non-dilutive cash that has been added to the company’s balance sheet.
The facility was non-essential to the company’s business model upon the decision in early 2020 to exit the crowded cannabis production market to focus as a biotech company, advancing novel drug candidates targeting lucrative areas of unmet medical needs like Muscular Sclerosis, Depression Disorders, and Inflammatory Disorders.
“This is a major accomplishment and puts us in a good position going forward especially considering the current state of the capital markets,” Anthony Durkacz, Interim CEO and co-executive chairman of FSD Pharma, said. “Combined with our existing cash on hand, we are sufficiently capitalized for operations through 2025, inclusive of budget allocations for planned clinical trials and without having to look to the capital markets for any additional funds. Our cash position now exceeds our market capitalization, as we continue to work toward building value for our shareholders.”
Photo: Courtesy of Esteban Lopez on Unsplash
