Cannabis stocks in the US and Canada were having a tough Wednesday and failing to keep pace with the rise on Wall Street.
Companies in the sector are still taking a hit in the wake of comments from US attorney general nominee William Barr, who said the current system around marijuana laws is "untenable" and he personally supports prohibiting marijuana across the US. He did, however, add that he would not "go after" cannabis companies in states that have chosen to legalize marijuana trade.
Shortly after the opening bell, the North American Marijuana Index, which tracks the top cannabis stocks in the US and Canada, slipped 0.83% to 255.81.
Ranking high on the list of duds is Aurora Cannabis Inc (NYSE:ACB), which tumbled after embarking on a $250 million convertible debt offering.
The stock dropped 7.5% to $6.78 in after-hours trading in New York.
KushCo Holdings (OTCQB:KSHB) fell 15.4% to US$5.04. Investors appeared to be unenthusiastic about the move by the parent company of Kush Supply Co, a cannabis-focused packaging company, to raise $34 million from a secondary offering.
Proceeds from the deal are expected to be used for general business purposes.
ICC International Cannabis Corp (OTCMKTS:KNHBF) was also a laggard, shedding 11.9% to US$0.44.
Its falling share price comes a day after the company revealed its plans to acquire 49.9% of Wayland Group’s international assets and license portfolio. On the list of what it gains from the deal are Wayland’s Swiss cannabis cultivation operation and its Maltese license to manufacture finished-dose medical cannabis.
Golden Leaf Holdings (OTCMKTS:GLDFF) (CSE:GLH) was also trading down 5.8% at US$0.11 on no reported news. Last month, the Toronto-based cannabis company, which operates in Oregon, Nevada and Canada, shook up its management by tapping William Kulczycki as its new CEO.
Trulieve Cannabis Corp (CSE:TRUL) gained the most traction in early trade, adding 10.7% to C$12.90.
A release out today says the founders of Florida’s largest medical cannabis company have entered into voluntary lock-up agreements in respect to their 75.5 million shares with the company. This means they won’t sell any of their Trulieve stock on or before July 25, 2019.
Earlier this week, the Canadian company, which has a reputation for being acquisitive, reported yet another takeover when it agreed to pay about $175 million to buy privately-held Whistler Medical Marijuana. Based in British Columbia, Whistler is one of Canada’s first licensed cannabis producers.
Contact Ellen Kelleher at [email protected]