Aphria CEO fires back at short-seller report

Aphria CEO Vic Neufeld responded to a short-seller report that has sent the company's shares down over 50 per cent since Monday, describing some of the allegations as "slanderous.” In an interview with BNN Bloomberg, Neufeld said the pot producer will provide a detailed, line-by-line rebuttal early next week to the report released by Hindenburg Research and Quintessential Capital Management (QCM) on Monday alleging the Leamington, Ont.-based company acquired Latin American assets at “vastly inflated” prices in a transaction the short-sellers claim benefited a group of insiders. The company’s response “will be very sequential and factual to tell our side of the story," Neufeld said. Meanwhile, QCM founder Gabriel Grego said he’s "eager" for Aphria to make good on its previously-stated threat to explore all legal options, adding he thinks documents obtained during the discovery process would contain a “smoking gun” proving the report’s allegations.

SOL Global defends Latin American deals with Aphria

SOL Global Investments Corp., the company cited in a short-sellers report as selling several Latin American cannabis assets for “vastly inflated prices” to Aphria, defended the transactions on Tuesday in a news release. The company said it will pursue “all available legal relief” to parties which have manipulated the firm’s stock price via false and/or misleading information. SOL Global CEO Brady Cobb said the short-sellers are “destroying the stock prices of SOL Global and other cannabis companies” by releasing misleading information to apply pressure on negative stock prices.

Quebec moves to raise legal cannabis age to 21

The Coalition Avenir Quebec government has moved to fulfill one of its main election promises, tabling a bill Wednesday that would raise the province’s legal age for cannabis consumption from 18 to 21. Quebec’s junior health minister Lionel Carmant, a neurologist, has cited concerns about marijuana’s effects on young adults’ brain development. If Bill 2 is adopted into law, Quebec’s minimum age for legal cannabis would be the highest in the country, as the legal age in all other provinces and territories is currently 18 or 19.

Pot short-sellers make gains, despite rising expense

Cannabis short-sellers made a US$157 million mark-to-market gain on pot stock losses in Canopy Growth, Aurora Cannabis, Tilray and Aphria on Tuesday – but the sector is becoming a more expensive bet as demand grows, according to S3 Partners. The financial analytics firm found that stocks like Tilray average 50,000 to 100,000 shares worth of recalls on a daily basis, while total sector financing expenses hit US$2 million per day, Bloomberg’s Gregory Calderone reports. However, S3 added that stock borrow availability and rates should ease as more institutional investors build long positions in the sector. In an email provided to BNN Bloomberg, S3 Partners said short-sellers have made US$77 million on Aphria since Monday when a report detailing allegations behind its Latin American operations was released.

DAILY BUZZ

"There's a big market for this stuff that we've been ceding to Canada and other places."
–  U.S. Rep. Collin Peterson on how industrial hemp has been elevated to crop status in the latest version of the U.S. 2018 Farm Bill that will open a significant door for farmers to grow it.
 

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