SMITHS FALLS, Ont. — Canopy Growth Corp. is warning a U.S. holding company it wants to set up could be delisted from the Nasdaq stock exchange, which is objecting to some of its plans.
The Smiths Falls, Ont. cannabis company says in a proxy filing that the Nasdaq has objected to Canopy consolidating its U.S. financial results should it close on the acquisitions of U.S. companies Wana, Jetty or the fixed shares of Acreage.
Canopy announced Wednesday that it will create holding company Canopy USA to hold its cannabis investments south of the border.
Canopy, which is also listed on the TSX, says it disagrees with the Nasdaq’s objection and thus has no assurance that it will remain listed on any stock exchange it is currently on. It says there is also no assurance it will be able to satisfy the conditions to list on an alternative exchange, if it incurs a delisting.
Its proxy filing says its Nasdaq and TSX listings prohibit it from investing in businesses in the U.S. pot market until U.S. laws change or until it lists on an alternative exchange that allows investments in such businesses.
Canopy says it believes it is complying with applicable laws and regulations but could see how the Nasdaq could allege it is violating the exchange’s cannabis policies.
“This is a novel structure, and there isn’t always immediate comfort with innovation. But we believe in this market opportunity and the need to start capitalizing on it, and this is the structure to make that happen,” said Brenna Eller, Canopy’s vice-president of communications, in an email to The Canadian Press.
“And it’s our job to show the value and the rationale here, and we will continue our ongoing dialogue with NASDAQ to support our compliance with their rules and regulations as we pursue this groundbreaking strategy.“
This report by The Canadian Press was first published Oct. 27, 2022.
Companies in this story: (TSX:WEED)
