Mugglehead interview Cannabis lawyer Ranjeev Dhillon who  remains optimistic for the longevity of the industry despite the pandemic-related market meltdown

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The cannabis companies that survive 2020 will be hardened, battled tested and able to thrive for years to come.

But make no mistake, the pandemic-related market collapse is shortening the runway for debt-riddled weed firms and the number of bankruptcies will start increasing in the coming months.

That’s according to Ranjeev Dhillon, partner at McCarthy Tetrault and co-leader of their cannabis division, who handles mergers, acquisitions and bankruptcies for some Canada’s largest weed companies.

“Generally speaking, this was going to be a challenging year in the capital markets for cannabis companies anyway,” Dhillon told Mugglehead while working from his Toronto home. “And the COVID crisis adds another layer of challenges because overall it impacted all markets in a very negative way.”

Between disappointing earnings, scandals and tight regulations, cannabis stocks have tumbled 80 per cent since last April making it harder for companies to access capital markets and stay afloat.

But the COVID-19 pandemic has sent markets and financing options further into a deep freeze, which will expose weaker companies that will have no other choice but to file for protection against their creditors, Dhillon says.