6/23/30 By DAN ULLOA
The Multi-State Operator (MSO) iAnthus Capital Holdings, Inc. announced that investment firm Gotham Green LLC is demanding repayment of the entire amount of a massive loan with interest, fees, costs and other charges that have accrued.
That amounts to about $160 million. Gotham Green invested in the company last year using a financial instrument known as a “Secured Debenture”.
While the company is based in the United States, it is traded on the Canadian stock market called the Canadian Securities Exchange. Because the MSO iAnthus, did not file their records in time with the proper authorities, they can no longer be traded on the Exchange. When their paperwork is filed for Fiscal Year 2019, it is possible they will be allowed to trade again. They were last trading at 30 cents a share.
It is likely that the MSO iAnthus failed to file their paperwork due to the issues stemming from Gotham Green. They had initially received an extension to file their paperwork due to COVID-19 and still could not make the deadline. The paperwork was due in early April. It is quite possible they are seeking to hide significant losses.
The MSO iAnthus initiated a review process and hired Canaccord Genuity Corp. as its financial advisor. The MSO iAnthus’ special committee of the board of directors is working to complete the review of a range of alternatives. According to a press release from iAnthus Canaccord has received several expressions of interest which if completed, would repay the Secured Debentures in full and in cash.
The Troubles of the MSO iAnthus
The MSO iAnthus’ trouble began in April when their Founder and former CEO Hadley Ford resigned after the company defaulted on a large loan. Ford was also found to have accepted a loan of $100,000 from Gotham Green managing partner Jason Adler, according to a source.
They purchased the company MPX which won a medical marijuana dispensary license. MPX was planning to open the dispensary up in Atlantic City this spring before COVID-19 hit. The MSO iAnthus owns and operates 35 licensed cannabis cultivation, processing, and dispensary facilities in 11 states.
They are not the only MSO in trouble. MedMen has gone from the top of the industry to a cautionary tale of what not to do when receiving investment capital.