Cannabis companies could go bust in 2020, industry insiders predict
2 Canadian companies sought creditor protection last month
Tuesday, January 21, 2020
What a difference a year makes. Around this time in 2019, the cannabis sector was booming. Investors wanted in and stock prices were skyrocketing. Today, share prices have tumbled and analysts are forecasting "many" bankruptcies by the end of the year. Just last month, two Canadian companies, AgMedica and Wayland, were granted creditor protection. Some producers are looking for an exit, even if it means being bought by their competitors. Others looking to beef up their cash reserves are offering to sell off equipment and greenhouses — at a discount. "But in most cases, those are assets you don't want to take on. They're not efficient," said Greg Engel, CEO of cannabis producer Organigram. (See also: Cannabis industry facing a credit crunch as scrutiny, skepticism mount)
