Zenabis stock is trading lower this morning after Zenabis Global (TSX:ZENA) (OTCPK:ZBISF) announced the early conversion of certain convertible notes.
The troubles of the past year or so in the cannabis sector have created problems for many companies trying to raise capital. However, it seems that things have taken a far more positive turn in the New Year, and in a new development, cannabis company Zenabis Global made a major announcement with regards to its finances.
The company announced today that it is going to convert some convertible notes early at a discounted rate and release some of the pressure on its finances. It helps to improve the situation somewhat for Zenabis, which has been in the middle of a precarious financial situation, with its working capital falling into the negative recently.
Zenabis Global is going to convert $6,040,176 worth of its secured convertible notes into common shares at the rate of $0.155 per share. However, this conversion will not come without a cost. The company has issued as many as 38,968,874 common shares of Zenabis stock in order to facilitate this particular transaction.
Zenabis stock is down 5.71% at C$0.165.
Lays Off Approximately 10% of Staff
Last week, it emerged that Zenabis Global had laid off as many as 40 of its employees in what is believed to be another attempt to find a path to profitability. The total job losses last week constitute as much as 10% of its workforce, and a spokesperson from Zenabis stated that most of the job losses had taken place at the company’s Vancouver office.
However, that is not all. Earlier in January, the company made an important executive appointment that led to a rally in Zenabis stock. Zenabis announced that Eric Rasmussen is going to be the Chief Financial Officer of the company, replacing Mike Smyth, who is retiring. Considering the financial troubles at the company, the new appointment created some excitement in the market.
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