The cannabis company’s recent missteps are having a serious impact on its operations
First, CannTrust admitted to Health Canada that it had tried to hide a certain percentage of its cannabis cultivation operations. Then, the expected happened. Health Canada yanked the company’s license. That was an outcome that everyone should have seen coming, as is the case with the next negative step for the company. CannTrust could soon be delisted from the New York Stock Exchange (NYSE), becoming the first cannabis company to be embarrassed in such a way.
CannTrust admitted in July that it had been operating five illegal grows for six months before receiving a license for them in April. The company was forced to suspend operations and wasn’t able to sell any of its stock, leaving it with 5,000kg that it couldn’t move.
The company’s then-CEO, Peter Aceto, was let go from the company as a result because he apparently knew what was going on and didn’t seem to care. Health Canada then allowed CannTrust to sell its existing inventory, but drew the line on any future operations. All sales and cultivation are suspended and the company’s future is now bleak.
The NYSE requires that companies maintain a stock price of at least $1 – CannTrust is currently at $1.15 and will most likely drop. If it stays below $1 for 30 days, it will be removed. Additionally, CannTrust didn’t file its second-quarter operating results on time. The company will argue that this is because of the ongoing investigation, but it, coupled with a stock slide, will give the NYSE enough ammunition to pull it off the exchange.