SNDL's 'Aggressive' Loan-To-Own Strategy Forces Delta 9 Cannabis Co. To Seek CCAA Protection
Portfolio Pulse from Jelena Martinovic
Delta 9 Cannabis Inc. has obtained creditor protection under the CCAA due to aggressive actions by SNDL Inc., which acquired Delta 9's senior secured debt. SNDL's strategy involves pressuring companies into bankruptcy to bid for their assets. FIKA Company has agreed to act as a plan sponsor for Delta 9's CCAA proceedings, proposing to acquire certain assets and provide interim financing.
July 16, 2024 | 3:35 pm
News sentiment analysis
Sort by:
Descending
POSITIVE IMPACT
SNDL Inc. has acquired Delta 9's senior secured debt and pressured the company into seeking creditor protection under the CCAA. This aggressive strategy may allow SNDL to bid for Delta 9's assets.
SNDL's acquisition of Delta 9's senior secured debt and subsequent pressure on the company to seek creditor protection positions SNDL to potentially acquire valuable assets at a lower cost. This could positively impact SNDL's stock in the short term.
CONFIDENCE 95
IMPORTANCE 90
RELEVANCE 100
NEGATIVE IMPACT
Delta 9 Cannabis Inc. has sought creditor protection under the CCAA due to aggressive actions by SNDL Inc. and its inability to repay debt. FIKA Company has agreed to act as a plan sponsor, providing interim financing and proposing to acquire certain assets.
Delta 9's move to seek creditor protection under the CCAA indicates financial distress, which is likely to negatively impact its stock price in the short term. The involvement of FIKA Company as a plan sponsor may provide some relief, but the overall outlook remains negative.
CONFIDENCE 95
IMPORTANCE 90
RELEVANCE 100