Another Canadian marijuana producer is in financial straits.
Vancouver-based cannabis firm Invictus Group has been granted creditor protection so it can conduct a strategic review to address near term liquidity issues.
Analysts have warned that a growing number of cannabis companies have fewer than six months of cash on hand, reflecting disappointing earnings and front-loaded capital expenditures.
In December, two producers sought creditor protection, AgMedica Bioscience and Wayland Group.
Invictus said it sought creditor protection with the Supreme Court of British Columbia to address issues related to a 10.6 million Canadian dollar ($8 million) security from its lender, ATB Financial.
The company said the total amount demanded was CA$10.6 million, along with legal and other fees incurred by ATB.
Invictus also announced the resignation of interim Chief Executive Officer Marc Ripa.
Ripa will remain on the board to assist with the transition.
The board has not yet named his replacement.
“While in CCAA protection, the Invictus Group will continue its normal day-to-day operations and plans to commence a review of strategic alternatives in the immediate future,” the company’s press release stated.
Acreage Pharms is a federally-licensed producer of cannabis and wholly-owned subsidiary of Invictus.
Shares of Invictus trade on the TSXV Exchange as GENE.