Canopy Growth Corp (NYSE:CGC) Makes Necessary Business Changes That Exposes It To Charges Of More Than C$700 Million

Canopy Growth Corp (NYSE:CGC) says that the expected C$700 million to C$800 million ($523M to $598M) charge won’t shift its stand. The confusion kicked in at that point, where the company decided to stop operations at two of its greenhouse facilities. The effects have been felt by about 500 employees who lost their jobs in the process.

Journalists have reached out to the Canadian based cannabis provider wanting it to explain its drastic move. The business guru has been quick to cast blame on the current state of the Canadian recreational market. According to it, the cannabis market has been progressing at what the company terms as slower than the expected growth rate.

Canopy’s take

The company also had something else to lay blame on. It pointed out to the Canadian laws outlining that they had pulled along with a massive impact. These laws brought about a dynamic that allowed the outdoor commercial cultivation of marijuana.

These two greenhouses are in British Columbia, and sources indicate that they are quite large. They are said to account for almost 3 million square feet of licensed production space, a figure that the business guru says was good enough in helping it achieve its set business objectives.

There are also some other reports revealing Canopy’s plan to set up a third greenhouse facility. Sources close to the company say that it will be set up in Ontario, although the company hasn’t made this confirmation yet.

Klein’s thoughts

David Klein, who happens to be the CEO, has also spoken elaborately regarding the recent developments. The leader admits that as a company, they were aware that quite a large number didn’t appreciate their decision. However, the leader outlined that it was up to them to take the necessary move that would help move the business forward.

Klein says that the company has been in one of the business leaders in the market for quite long, and they did not want that to change. The company’s shares have dropped by almost 33 cents in the course of the after-hours trading, but Klein remains optimistic.