Aphria Is Crashing After Research Firm Alleges It’s A ‘Shell Game With A Cannabis Business On The Side’

Aphria did not immediately respond to a request for comment

The marijuana producer Aphria slumped as much as 30% — to a low of $5.60 a share — after a firm alleged the company’s business was full of overvalued buyouts and fraudulent financial reporting.

“Aphria is part of a scheme orchestrated by a network of insiders to divert funds away from shareholders into their own pockets,” Quintessential Capital Management’s Hindenburg Research said Monday in a report titled “Aphria: a shell game with a cannabis business on the side.” Aphria did not immediately respond to a request for comment.

According to Quintessential, Latin American acquisitions announced by the company in July appear to be “largely worthless.” For example, Aphria announced plans to buy Marigold Acquisitions for $145 million from its sister company, Scythian Biosciences, where CEO Vic Neufeld also served as chairman. Hindenburg says Marigold Acquisitions isn’t worth the valuation as its official registered office is an abandoned building that was sold off by its mortgage lender in January.


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