Could Canopy Growth Get Delisted From Nasdaq?
There has been lots of excitement around Canopy Growth (NASDAQ: CGC) recently after the company announced it would be accelerating plans to enter the U.S. pot market (when it's legal to do so). Through the launch of Canopy USA, it will be able to hold all of its investments in U.S.-based cannabis companies.
But this could come at a serious cost to the business, and it may result in the cannabis producer getting delisted from the Nasdaq. Here's why that could happen and why it could be catastrophic for the stock.
By creating Canopy USA, Canopy Growth's ultimate goal appears to be to consolidate the results of Acreage Holdings, Wana Brands, and Jetty -- all cannabis companies that it is planning to acquire and that are separate from the business today. But due to the federal ban on marijuana in the U.S., Canopy Growth wasn't going to execute on any of those deals until the laws changed (otherwise, it would be in violation of U.S. laws and thus threaten its position on the Nasdaq). Through Canopy USA, a separate entity, however, it can exercise the right to acquire those businesses.
Source Fool.com
