Cann Group's share price dropped sharply on Tuesday even as the company strengthened its balance sheet by securing $712,000 through a private placement with new and existing sophisticated investors.
The funds are earmarked to scale up production of new flower strains at its Mildura facility and to support the supply of oils and gummies.
Despite the capital injection, the company's shares closed 22% lower at $0.021c.
Chief executive Jenni Pilcher said the placement provides "important funds" as it continues its quest to become a “leading Australian supplier of medicinal cannabis in various formats”.
The placement involved the issue of 41.8 million shares priced at 1.7c each.
Subscribers will also receive one attaching option per share, with an exercise price of 3c and an expiry date of 24 months.
