It appears difficulties in the cannabis sector have caused some trouble for a local company.
Chatham-based AgMedica has applied for protection from its creditors.
According to the December 2nd Superior Court filing, the company is in a “liquidity crisis” and has requested immediate financing to restructure its operations.
Court documents show AgMedica’s plans for an initial public offering to sell shares in the second quarter of the year fell through, leaving officials with the need to find other long-term financing options.
“…although AgMedica has significant business operations, assets and potential for future growth, a substantial amount of capital was committed to AgMedica’s expansion in anticipation of a potential initial public offering (the “IPO”), which would have provided the additional capital necessary to finance the Applicants’ operations and funded certain expansions that would have resulted in increased revenue; as a result of changing marking sentiments towards the cannabis industry, the IPO did not transpire.”
It had seemed that business was booming, expanding its business to adult-use consumers as well as for medicinal purposes.
The company was given the go-ahead from Health Canada back in August to begin the second phase of its expansion plans, tripling its current capacity.
30 staff were laid off in October, leaving about 160 full time employees at AgMedica, and the company is selling all of its properties with the exception of its Riverview Facility in Chatham.