Abattis Bioceuticals (CSE: ATT) is leaving the cannabis business for good. The announcement came late Friday night from the troubled issuer, and follows a failed acquisition as a result of a seemingly perpetual halt on the public markets.
The departure from cannabis operations comes as a result of the failure of the firm to acquire NutriVida, a Langley, BC-based fertilizer operation. The acquisition was to take the form of an all-share transaction, however with the equity being halted since February 4, and the pending review by the BC Securities Commission expected to take several more months, it seems that the shareholders of NutriVida walked away from the deal.
The acquisition of NutriVida, combined with the recent purchase of Pro Natura BV, was expected to float the company until such time that it was able to get its cannabis operations to a profitable state. The two acquisitions were expected to result in a cash flow positive operation, enabling the firm to spend funding on its cannabis division. However, with the capital markets currently blocked and now a failed acquisition, Abattis has no means for additional funding and must shutter non-profitable operations.
Abattis will now begin the process of disposing of its cannabis-related operations over the coming months. The issuer currently owns Gabriola Green Farms, a “late stage” applicant for a cannabis cultivation license located on an island off the coast of BC. Abattis also has investments in XLABS, a Belleville, Ontario cannabis lab facility, and owns an online marketplace for vaporizer products.
Abattis Bioceuticals has been halted for trading since February 4, 2019, and narrowly avoided a delisting in August following the firms failure to file financial statements.
Information for this analysis was found via Sedar and Abattis Bioceuticals. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security.
