Canadian cannabis company Atlas Global Brands is ceasing operations at a facility in Gunn, Alberta, and laying off 50 employees.
The company also recently parted ways with a key executive.
Atlas said in a news release that it continues to focus on cost reductions, savings and production efficiencies.
“Ceasing operations at the Gunn, Alberta facility was an extremely difficult decision, that was not taken lightly,” CEO Bernie Yeung said in a statement.
“We are working diligently to strengthen our liquidity and secure our path for the future in a challenging market and believe ceasing operations in Gunn, Alberta is an important step towards executing on our objective of reducing costs, streamlining operations and increasing margins.”
Atlas said packaging activities are being relocated to its facility in Chatham, Ontario.
The facility in Chatham serves as Atlas’ Canadian hub for the processing of domestic and export-bound medical cannabis flower and oils.
Atlas also said it conducted an end-to-end review of its global operations.
After the review, Alvarez & Marsal Canada was hired as financial adviser to Atlas Biotechnologies and Atlas Growers – both wholly owned subsidiaries of Atlas Global.
Atlas Growers was the operator of the Gunn facility.
“Based on that financial analysis and after careful consideration of available alternatives … it was determined to be in the best interests of the Atlas subsidiaries and Atlas Global as a whole to liquidate the assets of the Atlas subsidiaries, through a court-supervised process, in an orderly fashion so as to maximize recoveries for all affected stakeholders,” according to the Atlas announcement.
Atlas said its subsidiaries are currently in discussions with a senior lender “to determine the nature of the proceedings that will be commenced to effect this orderly liquidation.”
Citing the number and timing of recent acquisitions and the liquidation of the subsidiaries, Atlas said the forecasted gross profit and available funds noted in the restated Listing Statement dated Dec. 29, 2022, should no longer be relied upon.
Atlas has been on a buying spree of late.
Atlas, which lost 26 million Canadian dollars ($18 million) in the 12 months ended Dec. 31, 2022, has entered into binding agreements to acquire controlling interests in six pharmacies in Israel.
In April, the company completed the acquisition of another cannabis producer, GreenSeal, which has an indoor growing facility in Stratford, Ontario.
Atlas recently made changes to its management team.
In a subsequent news release, Atlas said Chief Operating Officer Jeff Gossain had left the company.
No reason or replacement was shared.
Atlas also said it is launching new products in collaboration with Snoop Dogg under the “D*gg Lbs” brand.
Shares of Atlas Global Brands are traded as ATL on the Canadian Securities Exchange.
