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Canopy Growth Corp. is set to become the latest cannabis producer to consolidate its shares to maintain its listing on the Nasdaq exchange.
The Canadian company’s board approved the share-consolidation plan on the basis of one post-consolidation common share for every 10 pre-consolidation shares.
The consolidation was approved at Canopy’s annual general meeting in September.
The move will bring the Ontario-based producer’s share price back into compliance with Nasdaq listing requirements, which require issuers to maintain a minimum bid price of at least $1 per share.
Canopy’s shares closed Monday at 69 cents on the Nasdaq.
If a stock trades below that $1 minimum for 30 consecutive business days, the Nasdaq issues a warning and grants a 180-day period for the company to regain compliance.
Nasdaq-listed cannabis companies that have completed share consolidations in the past include:
Canopy’s consolidation plan is expected to become effective Dec. 15, with the post-consolidation shares commencing trading on the Nasdaq (CGC) and Toronto Stock Exchange (WEED) on Dec. 20.
The plan is subject to final confirmation from the Nasdaq and TSX.
“By implementing this share consolidation, Canopy Growth expects to regain compliance with the Nasdaq’s bid requirement and further support the marketability of the Company’s shares,” Chief Financial Officer Judy Hong said in a statement.
A number of other cannabis companies are noncompliant with the Nasdaq’s listing standards
- Alberta-based Aurora Cannabis is noncompliant under the exchange’s bid-price rule.
- Israel’s IM Cannabis is also noncompliant under the bid-price rule.
- InMed Pharmaceuticals, a Canadian company that manufactures rare cannabinoids, is also noncompliant with the Nasdaq’s listing standards because of its low stock price.