Connect with us

Hi, what are you looking for?

Tuesday, Dec 7, 2021
Mugglehead Magazine
Cannabis & psychedelics industry news based in Vancouver, B.C.
  • Loading stock data...

Business

Hexo to shutter 3 production sites in early 2022

Around 155 employees will be impacted by the decision to shut down the facilities and centralize operations

HEXO to shutter 3 production sites in early 2022
A Hexo worker prepares a cannabis clone at the company's Belleville, Ontario facility. Photo via Hexo

On the heels of recent deals, Hexo Corp. (TSX: HEXO) (Nasdaq: HEXO) will be closing the doors to three production sites it acquired from buying Zenabis Global Inc. and 48North Cannabis Corp.

In a statement Tuesday, the firm says about 155 employees will be “impacted” by the shutdowns in a move that will centralize operations at its core facilities early next year.

Hexo says the decommissioning is part of its integration plan following the two acquisitions and the Redecan one.

The Kirkland Lake, Ont., and Brantford, Ont. facilities, gained through the 48North acquisition, will be shuttered Jan. 31, 2022.

And the Stellarton, Nova Scotia, facility acquired through its Zenabis deal, will shut down Feb. 28, 2022.

“These facilities are not considered material to Hexo’s integrated operations,” reads the statement.

Hexo closed the 48North deal in September, a day after the Redecan one. The Zenabis arrangement was completed in June.

While 155 employees are affected by the decision, Hexo says it’s working to “reduce the impact” by relocating some employees to roles at the core facilities. For those who can’t relocate, the firm says it’s supporting them with their job hunt.

Read more: Hexo co-founder and CEO exits after rocky ride

It was a difficult decision to close the facilities, but a “key component” to the integration plans, said president and CEO Scott Cooper.

“This decision is key to achieving our immediate priority of integrating our recent acquisitions to drive growth and profitability through the commercialization of cannabis consumer packaged goods products. We are confident that our core sites, combined with strategic partnerships, will ensure sufficient supply of high-quality cannabis to meet demand.”

On Tuesday, company stock dropped 3.5 per cent to US$1.52 on the Nasdaq.

Read more: Hexo reaches new highs this quarter, yearly sales up 57%

 

Follow Mugglehead on Twitter

Like Mugglehead on Facebook

Follow Kathryn Tindale on Twitter

kathryn@mugglehead.com

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

You May Also Like

Health and Safety

Science doesn't know yet, but one psychedelic researcher is chasing clues to see if it can

Canada

As more medium-to-small producers came into play this year, great weed started hitting legal shelves at fairer prices

Culture

Punishments for possession include caning and the death penalty. Despite a global trend of reform, The Fine City remains staunch in its anti-drug stance

Analysis

While legal weed businesses decry enforcement of their accounts, the platform says it's keeping its all-ages community safe