October 20, 2022
The Flowr Corporation, The Flowr Canada Holdings ULC, The Flowr Group (Okanagan) Inc. and Terrace Global Inc. (the "Group"), a group of companies specializing in the cultivation, processing, distribution, and sale of packaged dried cannabis flower, pre-roll and other cannabis products, obtained CCAA protection on October 20. While the Group is headquartered in Toronto, Ontario, it operates from leased premises located in Kelowna, British Columbia. The Group incurred significant operating losses in 2021 and the first six months of 2022 due to a mix of unfavourable factors, including over-supply in the market of cannabis products, price compression and the impact of the illicit market. The Group’s operating cash burn amounted to approximately $26.5 million during this 18-month period. To address these financial challenges, management have taken significant measures, including cost cutting and selling surplus or non-performing assets, in order to repay indebtedness and increase the Group’s liquidity. However, these efforts were insufficient to address the liquidity challenges facing the Group. EY was appointed monitor. Counsel is Miller Thomson for the Group, TGF for the monitor and Norton Rose for the DIP lender.
By Dina Milivojevic