TILT stock is rebounding in Thursday's session after TILT Holdings (CSE:TILT) (OTCQB:SVVTF) CEO Mark Scatterday responds to investor concerns.
CEO Addresses Investor Concerns
Vancouver-based TILT Holdings has been in all kinds of trouble over the past few months, and in a fresh development, the company’s Chief Executive Officer sent a letter to investors in which he cleared the air about the controversial stock-based $60 million compensation to executives. The reason why it was controversial was due to the fact that the company had made a hefty loss in the first quarter.
Mark Scatterday stated that the options had been issued to the concerned executives around six months ago, and at the time, he was not at the helm. Scatterday went on to state in his letter that the company and its executives are committed to the long term growth of the company. To that end, company execs have signed an extended lock up on the shares, by way of which the company’s stock would not change hands under any circumstances.
SVVTF stock is up 7% and trading at $1.06 on the OTCQB market. On the Canadian side, TILT stock is trading at $1.42, up by 6%.
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Reverse Takeover
It should be pointed out that TILT Holdings has been trouble ever since it came into being after a reverse takeover that involved as many as four companies.
The company went public on December 6 last year, and although shares climbed due to the overall market sentiments at the time, things soon went south. When the four disparate companies from different sectors of the cannabis industry joined hands to create TILT Holdings, it seemed like a decent idea. One company was involved in marijuana growing, while another operated dispensaries in Massachusetts and a third was engaged in customer relationship software development. The fourth company involved in the process created cannabis delivery software. It was only natural that there was widespread positivity over TILT stock, but things have not turned out well.
Troubles first surfaced in the company when TILT recorded a loss of $552 million in 2018, owing to a huge $496.4 million write-down in Q4 2018. When the company filed its documents for listing, it stated that it had assets worth $921 million, but on May 1, it reported that it had to write off $496.4 million worth of assets. More significantly, the $921 million in assets was in goodwill, which is, without a doubt, another red flag.
Despite today's recovery, TILT stock is down about 60% on the OTCQB market since the beginning of 2019. In fact, the stock made a new low of $1 earlier in today's session.
Featured image: DepositPhotos © Rangizzz
