For the last few years, if cannabis companies wanted money, there was a long line of folks happy to oblige. More recently, those financiers have dried up, causing raise-addicted cannabis pubco execs to reach for their ‘balance sheets for dummies’ text books and have urgent meetings with accountants regarding how they stay alive.
Sometimes a deal broken is a good deal for shareholders, especially if you give a red rat’s behind about your favourite company having enough money to survive the year. Lately, we’re seeing a lot of deals that, at one time, were announced with much fanfare, being quietly dropkicked off the bridge as once high flying companies realize they need to make more than they spend.
GTEC Holdings (GTEC.V) completed its transaction with Fire and Flower Holdings (FAF.T), selling them some of their Cannabis Cowboy (CCI) dispensaries in exchange for cash, so they can pay their debts.
Yesterday, weed stocks were generally green. The day before too. This brought about a load of folks on social media talking about how ‘cannabis is back!’ and ‘the bear market is over!’
GTEC Holdings (GTEC.V) signed an agreement to sell eight of their non-operational store locations to Fire and Flower Holdings (FAF.T) to finance their debenture debt today.
The cannabis bubble is not yet bursting, but the likelihood that it will go by the time you read this is high. The markets are wobbling hard for a multitude of reasons, but the cannabis sector is reeling because the bellwether cannabis stock, Canopy Growth Corp (WEED.T) is in freefall.