The Cannabist to Close Two Cultivation Sites in New Jersey, Cutting 86 Jobs 

The Cannabist Co. plans to shutter its two cultivation sites in Vineland, New Jersey in October, citing “company financial issues,” according to a notice filed with the state Department of Labor & Workforce Developments outlined by the Cherry Hill Courier-Post. The closures are expected to cut 86 jobs. 

The notice comes on the heels of the announcement of a takeover of some Cannabist operations in five states by Vireo Growth Inc. Vireo did not indicate which Cannabist facilities would be affected by the sale, but the notice filed with the state indicated the Cannabist was also selling – not closing – its South Jersey dispensaries in Vineland, Deptford, and Mays Landing. According to the filing, the dispensaries produced a revenue of $43.5 million last year – about 15% of the company’s total revenue for the year.     

In the filing, the Cannabist said the U.S. cannabis market “has suffered significant challenges in recent years” because of an oversupply caused by the illicit market and “an unexpected number of licensed competitors in certain jurisdictions.” The company added that access to banking and capital markets, supply chain issues, and “adverse tax consequences” due to federal cannabis prohibition “have acutely impacted the Company’s ability to operate its business profitably.” 

In March, the Cannabist entered into Companies’ Creditors Arrangement Act (CCAA) proceedings in Canada and Chapter 15 bankruptcy proceedings in the U.S. seeking recognition of the CCAA proceeding in Canada, which it was granted. The company also entered into a previously announced strategic review process initiated by a special committee of Cannabist’s board of directors comprised of independent directors, subsequently announcing that it would sell certain assets in Colorado, Illinois, Massachusetts, New Jersey, and West Virginia.