Acreage Holdings Furloughs Employees, Closes Facilities, Axes M&A Deal Due To COVID-19 Crisis

Acreage Holdings Inc. ACRG ACRGF became the latest cannabis company Friday to announce business cutbacks due to the coronavirus pandemic. 

The New York-based company's operational changes include the following:

• Temporarily firing 122 employees from field operations teams and the corporate office
• Temporarily halting business activities such as its wholesale operations in Iowa, dispensaries in Maryland and North Dakota and Form Factory operations in Oregon, Washington, and California
• Transforming its Queens dispensary into a delivery hub
• Abolishing the securities purchase agreement among GCCC Management, LLC, Greenleaf Compassionate Care Center, and High Street Capital Partners, LLC connected to the planned purchase of a Rhode Island dispensary

Acreage also canceled the signed merger agreement with Deep Roots Medical LLC because the companies couldn’t acquire needed approvals to complete the merger before the already set outside date, as there was a delay imposed by the Nevada Department of Taxation.

Steve Hardardt, executive vice president, CPO and administration, has resigned 

Acreage said it is retracting its previously announced 2020 financial goals and will offer a full update on its first-quarter earnings call May 13.

The COVID-19 pandemic forced the company to make a "very difficult decision" to furlough employees and close certain facilities, Kevin Murphy, Acreage's chairman and CEO, said in a statement. 

"Additionally, we withdrew from certain agreements with Deep Roots and Greenleaf as circumstances have materially changed," he said. "These bold measures will help to ensure that we emerge from this very challenging situation stronger than ever before.”

Other companies in the cannabis industry have also been laying off workers, although quarantine measures are believed to have inspired consumers to up their supply.

Acreage shares were trading down 9.9% at $1.82 at the time of publication Friday. 

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Photo courtesy of Acreage.