Canada continues to face an oversupply of cannabis that has pushed down prices even as the cost of capital has increased, which will result in more consolidation ahead, one executive told MarketWatch on Friday.
Julius S. Evancsits has now left his job as chief financial officer of Hexo as part of the acquisition of the cannabis company by Tilray Brands Inc. TLRY . The deal, which closed on Thursday, was announced in April. Hexo CEO Charlie Bowman has also stepped down, and Hexo’s stock has ceased trading. Tilray initially agreed in 2022 to acquire Hexo’s remaining $193 million in senior secured convertible notes as a precursor to the deal that closed this week.
“Everyone is raising capital to prepare for a longer haul,” he said. “You’re going to see a lot of the smaller players getting absorbed. … Price compression requires scale.”
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