Cannasouth Enters Voluntary Administration While CFO Resigns

In a significant development, NZX-listed Cannasouth (CBD) has entered voluntary administration, prompting the suspension of trading in its shares by the regulator. Earlier this week, the firm instigated a trading halt following a dispute with secured convertible noteholders, a situation deemed potentially detrimental to a critical capital raise by NZ RegCo.

Concurrently, Cannasouth announced the resignation of CFO and company secretary Colin Foster, effective March 27. CEO Mark Lucas expressed gratitude for Foster’s contributions, noting his pivotal role in steering Cannasouth’s journey as its inaugural full-time CFO.

The urgency to secure funding to ensure solvency prompted the move, with discussions ongoing until this morning when administrators from Blacklock Rose were appointed. Cannasouth clarified that the decision was made in consultation with noteholders, who nominated the administrators at the invitation of the board.

The administrators are set to conduct a comprehensive review of Cannasouth’s operations, focusing on identifying profitable product and service lines. Once completed, the administrators will seek financial support from shareholders and noteholders to implement the devised plan. Given the complexity of the review process involving the parent company and its subsidiary entities, a significant duration is anticipated for its completion.

Despite the organizational restructuring, Cannasouth reaffirms its commitment to customers, ensuring the provision of quality products that are compliant with stringent regulatory standards governing medicinal cannabis production and distribution.

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