- Cannabis company, Sunniva (CSE:SNN) will begin a reduction of its workforce in order to manage significant liquidity issues
- The company has also had to delay its filing of annual financial statements due to ongoing economic uncertainty
- Sunniva is continuing to pursue its legal rights under the current lease dispute for the Cathedral City Glasshouse
- The company is also attempting to restructure and finalise the shaky sale of shares in its subsidiary, Sunniva Medical
- Sunniva’s share price is down 5.26 per cent, and is currently trading for $0.18 per share
Cannabis company, Sunniva (CSE:SNN) will begin a reduction of its workforce in order to manage significant liquidity issues.
The company has reduced its current operating activities, but will continue operating its existing extraction and distribution facilities in California.
The staff reductions will impact management and other employee positions in California and Canada, taking effect on May 1, 2020. Today’s announcement did not specify how many staff would lose their jobs.
However, the reductions will apparently include the company’s Chief Operating Officer, Duncan Gordon. Sunniva’s Chairman and CEO, Dr Anthony Holler, commented on the company letting Duncan Gordon go.
“Duncan has been an integral part of Sunniva since the early stages, and was instrumental in the development of operations in California. We wish him all the best in his future endeavours,” he said.
Sunniva hopes that these reductions will preserve enough cash to assist with a variety of expenses. In particular, the company will use funds to pursue its legal rights under the current lease dispute for the Cathedral City Glasshouse. The dispute is currently in arbitration with JAMS court system in California.
Like many other companies, Sunniva has had to delay the filing of its annual financial statements, due to economic uncertainty. In light of the COVID-19 pandemic, various securities authorities have granted deadline extensions for such filings.
In this case, the British Columbia Securities Commission has granted a 45-day extension for filings due by June 1, 2020. Sunniva will rely on this extension to file its annual financial statements for the year ending December 31, 2019.
Until its statements are filed, the company’s management and other insiders will be subject to a trading black-out period.
Company CEO, Dr Holler, elaborated on the company’s shaky status.
“We are in survival mode. Sunniva is a company with minimal business operations, a core staff, a board of three individuals, limited capital resources, and significant debt due and coming due.
“The steps we are announcing will extend our runway while we defend our core asset, our legal rights under the lease in respect of the Cathedral City Glasshouse, pursue the monetisation of our Canadian assets, and explore refinancing options,” Dr Holler said.
In related news, Sunniva is working to restructure and finalise the sale of shares in its subsidiary, Sunniva Medical. The original outside date for the closing of the transaction has passed, but the buyer, CannaPharmaRx, remains onboard.
However, both parties are aware that current uncertain market conditions mean that this transaction may not end up being finalised.
Sunniva’s share price is down 5.26 per cent, and trading for $0.18 per share, as of 2:34pm EST.