==> Globe says Hexo replacing CFO and chairman <== 2021-12-15 08:00 ET - In the News
The Globe and Mail reports in its Wednesday, Dec. 15, edition that Hexo is replacing chief financial officer Trent MacDonald and chairman Michael Munzar. The Globe's Vanmala Subramaniam writes that former Canaopy Growth chairman John Bell will replace Mr. Munzar. The management changes were announced Tuesday morning alongside Hexo's first quarter earnings results for fiscal 2022, which saw increased revenue but an inflated net loss. Hexo is facing a severe debt overhang issue as it attempts to pay back a $327-million (U.S.) convertible loan that was used to fund its $925-million purchase of private cannabis producer Redecan in May. In October, Hexo's auditor, raised concerns about the company's finances because of how the convertible debt deal was structured. It required Hexo to pay back the loan in cash over the next year if its share price were to fall below $1.50(U.S.). Hexo's stock hovers at the 90 U.S. cents mark on the Nasdaq. Hexo has engaged a number of investment banks, as well as its current, unnamed debtholder, to figure out how to restructure the debt in a manner that "maximizes shareholder value." Part of the reason Hexo has been in freefall is because of the dilutive nature of the debt.