MARKET PLACE REAL ESTATE

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Skymint said in a statement Wednesday that going into receivership was “a di cult decision, but a necessary one.” e company did not respond to additional requests for comments ursday. e question remains of how far the market will fall and what happens to these companies operating under a receiver as rising interest rates make capital more expensive, and selling or buying troubled operations is thorny due to a patchwork of local regulations on license transfers to new owners.

“ e court-approved agreement will allow us to reorganize our debt obligations to address the nancial challenges facing many in Michigan’s cannabis industry, including excess supply, decreasing prices, limited access to capital and the increasing cost of capital,” Skymint said in the statement.

A court-appointed receiver is an unbiased third party that e ectively takes control over a company’s operations and nancial books and then makes a recommendation to the court on what the best path is to satisfy creditors, whether that means a reorganization of the company or a liquidation.

Skymint’s investors allege mismanagement in two lawsuits, but unfavorable market conditions are exacerbating its downfall.

Michigan’s marijuana industry has su ered an epic price collapse due to product oversupply — recreational marijuana retail prices have plummeted from $512.05 per ounce of ower in January 2020 to just $80.16 per ounce in January this year — effectively eliminating pro t margins for businesses across the state.

A struggle underway

Skymint spent and borrowed big to grow quickly as an early entrant into the legal marijuana market in Michigan. It now employs more than 600 across 24 retail dispensaries around the state and three indoor grow operations in Dimondale and Lansing. But a hefty debt load that kept ballooning as the company tried to stay a oat eventually became too much