Green Growth, Onetime Suitor for Aphria, Files for Bankruptcy

(Bloomberg) -- Green Growth Brands Inc., a cannabis company that made a failed pursuit for Aphria Inc., filed for bankruptcy protection after warning investors it was in “serious financial difficulty.”

The company said in a statement Wednesday its “severe liquidity crisis in the face of material matured and maturing debt” was made worse by the Covid-19 pandemic.

“The continuing operations of the company are dependent upon its ability to continue to raise adequate financing, to commence profitable operations, and to repay its liabilities arising from normal business operations as they become due,” Green Growth said. It requested court protection through the Companies’ Creditors Arrangement Act in Canada. Ernst & Young Inc. was appointed as the monitor in the proceedings.

All Js Greenspace LLC, one of GGB’s existing secured lenders, agreed to a debtor-in-possession loan facility of as much as $7.2 million, Green Growth said.

Its shares tumbled as much as 64% to 2 Canadian cents in Toronto.

Green Growth made a splashy attempt to take over one of the biggest players in the Canadian cannabis industry with a C$2.4 billion hostile bid for Aphria in January 2019. That came after a short-seller attack triggered a plunge that erased more than half of Aphria’s market value. Since then, Aphria has posted three consecutive quarters of profitability on an Ebitda basis.

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