Emerald Health Therapeutics, Inc. (CSE:EMH) (OTCQX:EMHTF) announced Monday that it is getting out of the recreational and medical cannabis industry and pivoting to pharmaceutical development. The company also announced its president and CEO, Riaz Bandali has resigned.
The Vancouver, British Columbia-based company plans to find buyers for its recreational and medical cannabis assets to further strengthen its already strong capital position and to significantly cut costs to reduce its monthly net burn.
Emerald also intends to maximize its cash position and seek business opportunities in pharmaceutical development where its board has significant expertise. The company has agreed to retain Vantage Point Advisors to assist it in identifying potential acquisition/merger candidates involved in pharmaceutical development and to carry out due diligence on selected candidates. Vantage Point Advisors is an independent, arm's-length business valuation firm with offices in New York, Los Angeles, San Diego, Portland, Seattle and Dallas-Fort Worth.
New Business Path
"Our management team and staff have shown exemplary commitment and effort in advancing Emerald's cannabis business, but in a market with a very large number of cannabis operating licenses, increasing competition and declining retail prices, the path to achieving profitability and increasing shareholder value has been very challenging," said Jim Heppell, chairman of Emerald's board of directors. "Instead of committing additional capital and effort to focus on this very challenging and saturated market, the board has decided that Emerald shareholders would be better served by the company exiting the recreational and medical cannabis business and pivoting into pharmaceutical development. We will now set out on a new business path that we believe has much greater potential to increase shareholder value."
In addition, the company noted that the company will file its Q3 financial results on Monday, November 29.
Price Action
Emerald Health's shares traded 2.63% higher at $0.06 per share at the time of writing Monday morning.
Photo: Courtesy of Dongki Koh on Unsplash