Ascent Industries Departs from Canadian Operations
Ascent Industries (CSE: ASNT) yesterday announced the formal sale of its Canadian assets, marking an end to the companys woes with Health Canada. After filing for creditor protection on March 1, the company formally entered into an agreement with BZAM Management, an affiliate of Gulf Bridge Ltd, for the sale of it’s embattled Canadian subsidiary. No terms were given for the agreement.
This news follows a months long battle with Health Canada, after a random inspection by the authority in August 2018 lead to Agrima Botanicals’ producer and dealer licenses being suspended on September 27. Reasons stated for the suspension by Health Canada indicate “unauthorized activities” were taking place on company grounds. Other reports indicate it was related to “record keeping and other compliance requirements.” While not specific, rumours have swirled in relation to product formats that may have been sold by the firm.
Following an unsatisfactory response to the matter by the company, Health Canada formally alerted Agrima Botanicals that it intended to pull it’s producer and dealer licenses on November 16, 2018. This quickly resulted in CEO Philip Campbell, COO Reid Parr, and chief business development officer James Poelzer stepping down from their roles within the company.The Ascent Industries subsidiary has since laid off ta large portion of its staff as it has taken measures to reduce capital expenditures while no revenues are being generated.
Although the licenses have yet to be formally revoked, a final decision is expected to occur in the short term. There’s no indication whether the sale of the operation will have an impact on this action taking place.
The purchase of the Canadian assets is expected to close by April 15, subject to a number of terms including court approval by the Supreme Court of British Columbia.
The company will continue with its operations in both Denmark and the states of Oregon and Nevada, the latter of which is suffering a similar fate as the local authority examines the operations of Sweet Cannabis, Ascent’s Nevada subsidiary.
Within a February 15 news release, Ascent identified that similar circumstances were playing out at its Nevada operations, in that it was alerted by the Clark County Department of Business License that it’s current license may not be renewed. Chiefly, it identified a similar set of issues as that of those brought forth by Health Canada. Among them:
- An SC hosted cannabis consumption event in the H-1 Zone Resort Corridor in Las Vegas
- Record keeping and inventory errors
- Parent company license suspension by Health Canada
While the hearing was set for February 28, 2019, there has been no release related to the further status of the business license. Public records for business licenses within Clark County, Nevada indicate that a temporary license still remains, and that a permanent license remains pending. There however is no indication of when this data was last updated.
Ascent Industries halted before the bell yesterday at the request of the company pending news. It has not as of the time of writing resumed trading. Shares of the company are currently priced at $0.10.
Information for this briefing was found via Sedar, Proactive Investors, Investing News Network, Health Canada, and Ascent Industries. 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. The author holds no licenses.
As the founder of The Deep Dive, Jay is focused on all aspects of the firm. This includes operations, as well as acting as the primary writer for The Deep Dive’s stock analysis. In addition to The Deep Dive, Jay performs freelance writing for a number of firms and has been published on Stockhouse.com and CannaInvestor Magazine among others.