Aphria to issue short-seller rebuttal once internal review completed

David George-Cosh, BNN Bloomberg

Aphria short-seller Grego speaks out as pot firm vows ‘complete rebuttal’

Aphria (APHA.TO)
7.01 0.77 (9.90%)
As of: 12/13/18 3:49:16 pm


Aphria Inc. () plans to issue a full rebuttal as soon as possible to a short-seller report alleging it acquired a number of Latin American assets at “vastly inflated prices” once its internal review behind the transactions with an independent committee is completed.

Aphria’s update ends several days of silence from the company after its chief executive officer, Vic Neufeld, pledged to release a detailed, line-by-line response to the report released by Hindenburg Research and Quintessential Capital Management. It alleges the Leamington, Ont.-based cannabis producer acquired assets in Jamaica, Argentina and Colombia in a transaction the short sellers claim benefited a group of insiders.

“As we said previously, we are committed to protecting our shareholders and restoring market confidence by confirming all the facts through an independent process to address innuendo and deception,” said an Aphria spokesperson in an email to BNN Bloomberg. “We have full confidence in the work being done by the special committee’s independent directors and their independent advisors to review and confirm the company’s record.”

The Aphria spokesperson said the work will be presented “as soon as possible” but the company will allow the special committee to “complete its work so that there can be no doubt of the conclusions presented as a result.”

The Aphria spokesperson added that information has surfaced independently that appears to discredit several allegations put forward by QCM and Hindenburg Research. The spokesperson wouldn't specify in the statement where that information was sourced from and was not immediately available for comment.

In a Dec. 3 report, QCM and Hindenburg allege that the foreign companies Aphria acquired in Jamaica, Argentina and Colombia appear to be “largely worthless” and that there were "systematic attempts to hide the true nature of these transactions." The report led to a freefall in shares of Aphria, which at one point lost about half of its market value, or about $1.2 billion.

The company’s stock traded at $6.92 on the Toronto Stock Exchange as of 2:46 p.m. ET on Thursday, down about 34 per cent since the release of the short-seller report.

Both QCM and Hindenburg have taken short positions in Aphria, meaning they stand to benefit if its stock falls.

Neufeld told BNN Bloomberg on Dec. 6 the allegations published in the report, specifically several claims relating to Aphria's acquisition of its Jamaican cannabis licence from SOL Capital Investments Corp., formally known as Scythian Biosciences Inc., were "slanderous."

Both the Ontario Securities Commission and the U.S. Securities and Exchange Commission have so far declined to comment on whether they have begun an investigation into Aphria or the short seller’s report on the company.

QCM tweeted on Dec. 12 that it stands by its research and hopes Aphria “will address all the allegations exhaustively.”

The company’s founder Gabriel Grego declined to comment to BNN Bloomberg when asked if the firm still maintains a short position on Aphria.


Source

House Positions for C:HMMJ from 20181213 to 20181213

House	Bought	$Val	Ave	Sold	$Val	Ave	Net	$Net
7 TD Sec	126,431	2,008,082	15.883	96,640	1,536,427	15.898	29,791	-471,655
9 BMO Nesbitt	41,846	664,738	15.885	22,231	353,660	15.908	19,615	-311,078
33 Canaccord	16,000	264,580	16.536	2,009	31,825	15.841	13,991	-232,755
85 Scotia	22,324	355,007	15.902	11,117	177,058	15.927	11,207	-177,949
124 Questrade	9,005	143,441	15.929	1,525	24,469	16.045	7,480	-118,972
19 Desjardins	8,898	144,336	16.221	1,500	24,119	16.079	7,398	-120,217
13 Instinet	48,990	780,338	15.929	43,400	689,169	15.879	5,590	-91,169
53 Morgan Stanley	5,000	78,354	15.671	0			5,000	-78,354
88 Credential	3,761	59,307	15.769	270	4,409	16.33	3,491	-54,898
22 Fidelity	5,822	92,563	15.899	2,750	43,367	15.77	3,072	-49,196
59 PI	2,000	32,388	16.194	0			2,000	-32,388
76 Industrial Alliance	1,700	26,707	15.71	0			1,700	-26,707
101 SG Capital	3,200	50,436	15.761	2,000	31,536	15.768	1,200	-18,900
99 Jitney	5,553	89,340	16.089	4,600	74,795	16.26	953	-14,545
28 BBS	500	7,925	15.85	0			500	-7,925
14 ITG	1,169	18,784	16.068	750	12,044	16.059	419	-6,740
36 Latimer	100	1,622	16.22	0			100	-1,622
8 Eight	7,200	112,680	15.65	7,200	112,680	15.65	0	0
143 Pershing	165	2,600	15.758	215	3,417	15.893	-50	817
89 Raymond James	1,420	22,952	16.163	1,720	27,043	15.723	-300	4,091
70 Manulife	390	6,134	15.728	700	11,067	15.81	-310	4,933
57 Interactive	348	5,518	15.856	1,956	31,551	16.13	-1,608	26,033
65 Goldman	0			2,000	31,620	15.81	-2,000	31,620
39 Merrill Lynch	50,972	811,661	15.924	57,315	915,686	15.976	-6,343	104,025
1 Anonymous	233,323	3,699,678	15.856	240,312	3,820,652	15.899	-6,989	120,974
79 CIBC	384,426	6,098,980	15.865	391,621	6,215,914	15.872	-7,195	116,934
2 RBC	74,909	1,190,970	15.899	83,489	1,329,608	15.926	-8,580	138,638
80 National Bank	22,338	354,213	15.857	102,470	1,621,218	15.821	-80,132	1,267,005
TOTAL	1,077,790	17,123,334	15.887	1,077,790	17,123,334	15.887	0	0