Creditors of cannabis giant MedMen Enterprises are gearing up for a critical meeting in the coming weeks, as the company enters bankruptcy proceedings in Canada and places its California retail assets under receivership. This marks a significant downturn for the once-thriving multistate operator, signaling what could be the most notable collapse in the marijuana industry’s history.

The company’s financial woes have been mounting, with creditors reporting claims totaling over 560 million Canadian dollars ($410 million). This staggering debt load positions MedMen as a prime candidate for what could be the largest failure in both U.S. and Canadian marijuana retail.

At its peak, MedMen boasted over 20 stores nationwide, including a significant presence in California with approximately a dozen outlets. However, the company’s inability to meet financial obligations has led to drastic measures, including bankruptcy filings and asset liquidation.

B. Riley Farber, a Toronto-based advisory firm, has been appointed as the bankruptcy trustee. Alongside the massive debt owed to secured creditors, MedMen also faces substantial outstanding payments to former employees, brands, and service providers.

The creditors meeting scheduled for May 14 is expected to draw significant attention, with 11 secured creditors already claiming amounts surpassing CA$202 million ($148 million). Notable among these are Treehouse Real Estate Investment Trust and Hankey Capital, both owed substantial sums by MedMen.

MedMen’s California subsidiary, MM CAN USA, has been placed into receivership in Los Angeles Superior Court, where it will undergo dissolution and asset liquidation. This includes seven provisional retail licenses and an annual manufacturing license, according to the Department of Cannabis Control.

While MedMen’s downfall may mark the end of an era for the company, it could also signal broader challenges within the cannabis industry. As regulations evolve and financial pressures mount, more companies may find themselves facing similar fates. With federal restrictions on bankruptcy proceedings for plant-touching companies in the U.S., receiverships like MedMen’s could become increasingly common as the industry grapples with financial instability and regulatory hurdles.

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