Still reeling from a Health Canada review after it was discovered the company had been growing in unlicensed rooms, the beleaguered CannTrust Holdings Inc. (TSX: TRST; NYSE: CTST) just announced a blackout on company insider trading.
That blackout is expected to remain in effect until after the company releases Q2 financial reporting, which will be delayed due to the ongoing Health Canada review and internal company investigation.
The company announced today that the August 14 filing deadline will be missed, as the potential impact of any decision reached by Health Canada will have an unknown effect of the value of CannTrust assets and inventory.
In addition to the informal blackout on directors and management from trading shares, CannTrust informed the Ontario Securites Commission (OSC) that an official Management Cease Trade Orders may be issued in the coming months.
While federal agencies continue to investigate amid the possibility of CannTrust losing its license entirely, the company has retained Greenhill & Co. Canada Ltd. to initiate a strategic review.
While the end result of that separate review is still up in the air, the company has stated a possible outcome could include selling off all or a portion of the company to another entity. Discussing the hiring of Greenhill and even more regulatory issues arriving this week, CannTrust issued this statement:
An investigation from the Ontario Securities Commission is just the latest in a string of major setbacks for the company since the unlicensed growing was discovered. Most recently, the board of directors fired Chief Executive Officer Peter Aceto for cause, and additionally demanded the resignation of board chairman Eric Paul.
Those drastic upper management changes arrived after emails leaked online showed that the company CEO and other high ranking executives were aware of the unlicensed grow rooms and actively tried to hide them from regulators.