CannTrust Holdings Inc. (TRST.TO) hired Greenhill & Co. to explore a sale after a regulatory breach led the Canadian pot company to fire its chief executive officer and erased almost $500 million in market value.

Greenhill will act as financial adviser to a special committee of CannTrust’s board, which will review potential alternatives including a sale, a strategic investment or a business combination, CannTrust said in a statement Wednesday. The special committee was appointed to review the breach after regulators from Health Canada found the company grew cannabis in unlicensed parts of its greenhouse in Pelham, Ontario.

CannTrust fired CEO Peter Aceto and asked chairman Eric Paul to step down last week after a report that executives were aware of the unlicensed growing several months before Canadian regulators unearthed the breach. The stock has plunged by more than half since the revelations, cutting the market value to about $425 million.

CannTrust rose 6 per cent to $3.01 at 9:37 a.m. in Toronto.

The sixth-largest pot producer in Canada by revenue has also halted all sales and shipments of its cannabis products to medical and recreational markets while Canadian regulators assess the situation.

It may not be easy to find a buyer for the company, as it faces potential suspension or cancellation of its cannabis license as a penalty for violating federal growing rules. Several law firms are also seeking to launch class-action lawsuits on behalf of investors.

“While we believe CannTrust’s physical assets may still be of value to other Canadian licensed producers, we do not anticipate the company being acquired in the near term given the uncertainty surrounding the penalty expected to be levied by Health Canada,” Canaccord Genuity analyst Derek Dley wrote in a note last week.

Interim CEO Robert Marcovitch told BNN Bloomberg TV that the company is working “transparently” with Health Canada and the Ontario Securities Commission.

“We have not sat on our hands and we want to know the facts,” said Marcovitch, who is also a director. “As we continue to gather them, as we continue to have a level of confidence, we will act.”

CannTrust filed a response July 17 to Health Canada’s non-compliant inspection report, and the government agency “will thoroughly review the information submitted,” according to Health Canada spokesman Eric Morrissette. Health Canada continues to test samples of CannTrust product that were produced at the Pelham greenhouse.

The Vaughan, Ontario-based company said that the special committee’s review may not result in any transaction. It hasn’t set a timeline for the conclusion of its review.

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