Another US multi-state operator has hit the rocks. Tilt Holdings (CBOE: TILT) this morning announced that they have filed for, and been granted, an initial order in the Supreme Court of British Columbia under the Companies’ Creditors Arrangement Act.
The filing follows the company reaching an agreement with the holders of senior secured notes of the company which will result in a restructuring of the company. The board of the company is expected to remain in place as part of the proceedings, with the company to remain responsible for continued operation under the supervision of the court.
Tilt has indicated that they will fund the entire process via cash on hand, as well as through a US$2.0 million senior secured promissory note, referred to as the bridge notes, provided by existing noteholders. In exchange, Tilt is to be taken private as part of the CCAA process, which will see all current equity in the company cancelled, and new equity issued to the noteholders.
Given the financial position of the company, the board has determined that this plan is the best path forward for the company, with a formal vote on the matter from noteholders expected to occur on November 17.
“Over the past 18 months, TILT has taken deliberate steps to streamline operations and strengthen its core business. We reduced operating expenses by approximately $10 million annually and initiated a strategic review process of plant-touching assets, completing the first phase with the sale of our retail operations in Massachusetts to date,” commented Tim Conder, CEO of Tilt.
“This restructuring intends to align our balance sheet with the current scale of the business and position TILT for long-term stability and growth. We expect to emerge with a supportive creditor and ownership groups aligned with the Company’s strategic objectives. This process will also enable further cost reductions, including public company expenses of approximately $2.5 million, and support continued investment in innovation, including the full-time return of Jupiter’s founder, Mark Scatterday,” he continued.
Tilt Holdings is expected to be delisted from the CBOE and OTC Markets as part of the proceedings.
Information for this briefing was found via the sources mentioned. 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.
