Canadian cannabis producer Phoena Group has been granted creditor protection and is winding down its operations, the company said in court documents.
The Vaughan, Ontario-based company – formerly called CannTrust – said it no longer has the financial footing to continue operating.
As a result, Phoena plans to immediately halt the cultivation of new plants, destroy cannabis inventory not yet released for sale and lay off 87 employees, although upward of 238 of its workers will be affected.
CannTrust was one of the leading cannabis producers in Canada until it became embroiled in a cultivation scandal in 2019, with nearly 600 employees at the time and 19 million Canadian dollars ($14 million) in quarterly sales.
In the initial application under Canada’s Companies Creditors’ Arrangement law (CCAA), Phoena listed many challenges facing the company, including the oversupply of cannabis products in Canada, competition from other producers, over-regulation
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