The Daily Hit is a recap of the top financial news stories for June 22, 2023.
On the Site
Canopy Growth Sees More Than $3 Billion in Losses
Canada-based cannabis industry leader Canopy Growth Corporation (TSX: WEED) (NASDAQ: CGC) has reported steep rising losses worth more than C$3 billion. Canopy posted revenue of C$87.54 million for the fourth quarter ending March 31, 2023 versus last year’s $101 million – a decline of 14%. Still, the revenue figure beat Yahoo Finance’s analyst average of $73.1 million for the year. Read more here.
SEC Fines Marcum $10 Million for Improper SPAC Audits
The Securities and Exchange Commission censured accounting firm Marcum LLP for engaging in unethical and improper professional conduct related to Special Purpose Acquisition Corporations (SPAC). The SEC also noted that Marcum offered $10 million to settle the case, which the commission said it will accept it. Marcum is major accounting partner in the cannabis industry. Read more here.
Colorado Cannabis Market Shows First Price Rise Since 2021, Ducking Deflation
After nearly a two-year stretch of deflation, marijuana prices in Colorado are showing the first signs of life since October 2021, according to the Colorado Department of Revenue. The retail price for a pound, which had plummeted from a peak of $1,731 in January 2021 to a historic low of $649 by April 2023, has risen to $703 in June 2023. The price hike is a break from the two-year trend of slumping cannabis prices, which hovered around half of the rates seen before 2022. Read more here.
iAnthus Gets Hit With a RICO
A Maryland-based cannabis dispensary, LMS Wellness Benefit LLC, has accused iAnthus Capital Holdings Inc. (CSE: IAN) (OTCPK: ITHUF) of a scheme to divert at least $4.5 million from its funds into iAnthus’ other business interests, according to a lawsuit filed in federal court this week. In the civil RICO suit, LMS claims that a management firm it had hired, S8 Management LLC, which shares several executives and directors with iAnthus, made unauthorized money transfers from LMS’s account to the failing subsidiaries of iAnthus, Law360 reported. Read more here.
Anti-Cannabis Group Sues New York Over Legalization
A group of anti-cannabis parties has banded together to sue the State of New York including Governor Kathy Hochul, the Cannabis Control Board and the Office of Cannabis Management. The case was filed on June 20, 2023. New York passed the Marijuana Regulations and Taxation Act (MRTA) on March 31, 2021 which legalized adult-use cannabis. Read more here.
Unlicensed Dispensary Landlords Face New Penalties Under Council Bill
In Other News
Fire & Flower On Sale
Fire & Flower Holdings Corp.(TSX: FAF) (OTCQX: FFLWF) has received approval from the Ontario Superior Court of Justice under the Companies’ Creditors Arrangement Act for the implementation of a sale and investment solicitation process to be conducted by FTI Consulting Canada Inc., and a stalking-horse agreement between the company and 2707031 Ontario Inc., an affiliate of Alimentation Couche-Tard Inc. Read more here.
Hexo, Tilray Deal Closes
HEXO Corp. (TSX: HEXO; NASDAQ: HEXO) announced today the closing of the second of two tranches of the non-brokered private placement of Series 1 Preferred Shares previously announced on June 1, 2023 and the subsequent completion of the transactions contemplated by the previously announced statutory plan of arrangement under section 182 of the Business Corporations Act (Ontario) involving the Company and Tilray Brands, Inc. (NASDAQ: TLRY) Read more here.