CannTrust Holdings (TSX: TRST) (NYSE: CTST) has terminated CEO Peter Aceto and made senior management changes following the ongoing investigation by a special committee of its board of the company’s non-compliance with Health Canada regulations.
In a statement, the company said that the investigation uncovered new information that has resulted in a decision by the board to terminate Aceto with cause. Additionally, the board demanded the resignation of the company’s Chair Eric Paul who complied.
Effective immediately, the board has appointed Special Committee Chair Robert Marcovitch to the role of interim CEO and he will step down as a member of the special committee.
Marcovitch was most recently the President and CEO of K2 Sports, an international developer, manufacturer, marketer and distributor of winter sports equipment. He was previously the CEO at The Coleman Outdoor Co., and prior to that, was CEO of Ride.
“Our first priority is to complete the remaining items of our investigation and bring the Company’s operations into full regulatory compliance. Implementing the necessary changes is essential to the interests of our medical patients, customers, shareholders and employees,” Marcovitch stated.
Further, CannTrust said that it made a voluntary disclosure to Health Canada based on new information uncovered by the investigation. “The company will fully cooperate with the regulator in an open and transparent manner to resolve these matters fully and expeditiously,” according to its statement issued at end of the last week.
Meanwhile, the company said that it is preparing to make additional operational changes in the days and weeks ahead, which will be announced in due course.
Shares of CannTrust have fallen over 16% over the past five days.