Mon. Aug 2nd, 2021

GenCanna comes under the hammer of bankruptcy

GenCanna and its subsidiary Hemp Kentucky filed for bankruptcy protection just after a bad season. The hemp producer and CBD manufacturer filed chapter 11 bankruptcy petition in January. The company claims they owe money to a lot of investors.

The list of the companies are as follows –

  • Pinnacle.
  • Crawford Sales.
  • Integrity/Architecture

According to the filed petition, privately held GenCanna owes around $100 million to $500 million to 50-99 creditors. GenCanna says it has assets in the same range.

Although the court has not given a set date.

Chapter 11 gives the provision to GenCanna to continue its operations while working through a reorganization plan, this means they will work to refinance the existing debt by borrowing or selling.

“We are planning to have a complete restructure, as this will help us get back and solve the problems, since we could not do it on our own earlier.” GenCanna Global CEO Matty Mangone-Miranda said.

The situation of bankruptcy came after a lot of challenges in the business, this resulted in bad performance in the market. GenCanna was forced to lay off a number of employees in the past few months.

A farmers group announced lawsuits against the company in the fall, claiming broken contracts and inferior seed. GenCanna has partnered with more than 60 local farms, growing approximately 30 million plants on more than 6,000 acres.

In November, the company faced a tragedy, where part of its production facility in Winchester exploded and caught fire with employees inside. Although no one was injured, significant property was damaged.

GenCanna owed them more than $13 million according to building contractors, as they filed 19 liens on the property in September and October. The liens delayed construction of the company’s Mayfield processing facility.