TRST shares continue to drop
Yesterday’s news of cannabis giant CannTrust’s (TRST) unlicensed rooms debacle caught a lot of people off guard. The company is arguably one of the leading LP’s in the sector, and for a giant to be so negligent about its business practices sent ripples through the cannabis space.
TRST shares were down over 21% on the day yesterday, and today aren’t recovering well either, down an additional 6.8% as of this morning.
Now, even more shockingly, founder of Canntrust Eric Paul is claiming management knew nothing about the unlicensed rooms, and instead of firing the CEO are instead firing a low level employee. So if management didn’t know about these rooms, they had to be hidden or something. Maybe it was kind of wizardy, or maybe, it was simply a disguise like a series of outhouses at the edge of the property.
Potentially something like this:
Health Canada ordered the cannabis giant to place 5,200 kilograms of unlicensed cannabis on hold as a result of the audit. The company has voluntarily placed an additional 7,500 kilograms of dried cannabis equivalent produced in previously unlicensed rooms at its Vaughan, Ont. facility on hold as well.
That’s capitalism, bitch
On the surface it’s a bit surprising Paul going to bat for CEO Peter Aceto over the mess.
But, a little bit of digging explains why Aceto and Paul have a strong relationship, I have a feeling money could be the reason Paul is standing up for Aceto in this situation:
Yes, Paul dumped shares recently before the big dip. Why hurt a guy who’s made you stacks of cash when you could just fire a low level employee who you have probably never met before?
One of the reasons the CEO makes the big bucks rather than the employees is the CEO is responsible for the company at the end of the day. Generally, in leadership or management you learn to take the blame for when things go wrong, and distribute credit when things go well.
Most sports MVP’s don’t say ‘yeah, I played fucking awesome and totally deserve this’, instead they say: ‘I’d like to thank my team who played really well and the coaching staff etc. And when things go wrong, the true leaders say, ‘ this falls on me, I need to be better’.
So, if CannTrust does recover and the market forgets about this debacle, Aceto better not take any credit for the comeback.
Here is an ex CannTrust employee commenting on the issue: