R/S is opposite of dilution Dilution is a term used to describe the issuing of additional shares therefore spreading the value of each share thinner (diluting their value)
A reverse split reduces the share count therefore the value of each share represents a bigger portion (share) of the company. This is why the SP goes up and all the historical prices are in turn adjusted upward after the consolidation takes place.
For the sake of agreement let's say canopy does indeed issue shares afterwards, why would they do this? Two immediate answers are
1) they need more money
But do they? They raised $50 mil at $1.09 / share not very long ago and they removed the cash burn of biosteel. We can all guess but we can all also access their quarter reports to make a more educated / informed guess.
2) they issue shares to take over another company
But will they? Is there a company or sector you can think of that they should go after?
Taking over another company immediately gives canopy added market share and there is value in that.
Pretty sure most on the forum only wish to daytrade so I wouldn't take any more of your time.
If there is an actual investor out there, then I hope this helped
Q