Update on FSD Pharma and Kraft Building

The company that bought the old Kraft building had big plans at first.  They wanted to be the biggest grower of Marijuana plants in Canada and they floated their shares under the ticker HUGE.  But in July 2020, they announced that they would be giving up on that idea and selling their Cobourg facility with an asking price of $19M.  They moved out and are now based in Toronto.  Work is now focused on developing medications and when the Covid-19 pandemic struck, they aimed at using Cannabis compounds for its treatment.  Their latest announcement is that they have a licence agreement with an Italian company to “develop U.S. Food and Drug Administration (“FDA”) approved veterinary drugs for the treatment of gastro-intestinal diseases in Canine and Feline (Dogs and Cats).”   Meanwhile they have lost millions (over $30M in 2020) and raised more money by selling more shares.

Their most recent statement of intent (26 January 2021) says that they will continue to research products to treat Covid-19 although “the Company may not be in a position to complete the Study prior to the end of 2021.” And “In addition, the Company is actively seeking appropriate potential buyers and is hopeful to finalize the sale of its non-core real estate asset in Cobourg, Ontario. The Company and its counterparty agreed to terminate the previously announced conditional sales contract for this real estate asset.”  They also announced that their president (Mr. Zeeshan Saeed) had been fired for cause (details not provided).

The original broker for the property found a buyer who proceeded to do “due diligence”.  The name of the potential buyer was never announced.  However, that sale was not completed and the property is now back on the market with a different broker (Cushman Wakefield).  The asking price is a large part of the company’s balance sheet (it was $42M at the end of 2020) so its sale at a good price is important to them.

Meanwhile, the Cobourg’s Heritage community and the Town were concerned about the fate of the Certo building at the rear of the property.  In 2018 FSD Pharma said that they planned to use it as an on-site Cannabis dispensary.  It was in danger of collapse and FSD Pharma promised to fix it.  In December 2020, Historic Carpentry and Historic Brick company were working on the roof and masonry.

They obviously now have no plans to “dispense Cannabis” so restoration must be being done to meet obligations and to make the property more “sellable”.

Links

External Links

Previous Posts on Cobourg news Blog

A selection

Print Article: 

 

19 Comments
Inline Feedbacks
View all comments
Dunkirk
23 March 2021 9:18 am

The actual value of the former Kraft plant will have to be what a new buyer is willing to pay. As with other major developments in our Town, rarely does the new buyer surface locally. Our people know the history too well…..The public cannabis company has been putting various values on the property and recently were challenged by shareholders in Superior Court on some of their past representations. Local investors if there are any willing to admit to that–might still be able to make a claim in that regard: See link below: You’re welcome. – https://www.businesswire.com/news/home/20210213005001/en/Morganti-Co-P.C.-Announces-Settlement-Approval-for-FSD-Pharma-Inc.-Securities-Class-Action – I have no idea what the company originally paid; what us taxpayers contributed or if any Property taxes remain outstanding–but those should all be fair questions at this point. If the Kraft plant is worth $40mm++ what is Brookside worth? $100mm++?….what about Sidmore?….what about Golden Plough Lodge?…a Billion? – It’s interesting to note that when the owner of our Mall went insolvent and one of Canada’s largest real estate co’s Timbercreek was forced to put this underperforming asset on their balance sheet, they needed to provide vendor take-back financing(one analyst reported more than 120%) in order to encourage somebody to buy that ‘asset’. It is a sad reflection on our Town that it was the $7.5B company’s ONLY underperforming piece of real estate in a portfolio of hundreds of properties. The lesson here might be that, it’s not easy to find buyers–or financing- even in times of a relative real estate ‘boom’. Another lesson might be that any commercial vacancy associated with the name ‘Cobourg’ might also be problematic.(?) If Cushman-Wakefield finds somebody to pay $40++mm for the Kraft plant, lets get them to put their sign in front of Brookside and a few other vacant gems we have on the tax rolls.… Read more »

Sandpiper
22 March 2021 4:10 pm

I wish there was less Censoring and more Fact Checking published
Real Investigative Reporting must be a thing of the past
We should be holding Certain parties Accountable
This was a costly mistake to all of Northumberland and its constituents that invested
and relied on our elected officials to run proper background checks .
Instead they take photo opportunities & used propaganda to further their own interests and political careers .

Wally Keeler
Reply to  Sandpiper
22 March 2021 4:29 pm

This was a costly mistake to all of Northumberland and its constituents

What did it cost all of Northumberland? What did all of Northumberland spend on what parts of the scheme? Give us some facts so that we can check them.

Last edited 4 months ago by Wally Keeler
ben burd
Reply to  Wally Keeler
22 March 2021 5:26 pm

Sandpiper provide facts? Not a chance just useless gossip and conspiracy theories.

JimT
Reply to  ben burd
23 March 2021 5:26 am

A tale…full of sound and fury…

Last edited 4 months ago by JimT
Sandpiper
Reply to  ben burd
23 March 2021 8:14 am

The County supplied start up Town was utility incentive and what ever else we don’t know about. like employment incentives .
Residents fallowed the Propaganda and invested not everyone but there were a lot one fellow I know lost approx. $200 k on average though many invested
$5 to $10 k on what the thought was to be BIG Business coming to Cobourg

Wally Keeler
Reply to  Sandpiper
23 March 2021 11:19 am

“The County supplied start up Town was utility incentive and what ever else we don’t know about.”

  1. Northumberland County gov’t supplied how much start-up?
  2. What specific “utility incentive” did the Cobourg municipal gov’t offer/provide?
JimT
Reply to  Sandpiper
24 March 2021 7:03 am

“…one fellow I know lost approx. $200 k…” 

Neither the town nor the county is responsible for an individual’s losses resulting from speculation in the stock market.

Local governments have no role to play in an individual’s investment decisions.

Sandpiper
Reply to  Wally Keeler
23 March 2021 8:22 am

I guess you didn’t invest many did ask around

Wally Keeler
Reply to  Sandpiper
23 March 2021 11:11 am

constituents that invested and relied on our elected officials to run proper background checks .

I have no sympathy for those investment losers. If they “relied on our elected officials“, then they deserved to lose. The individual investors were motivated with greed, get some KKKKs, but, caveat emptor. Other individual investors did their due diligence and avoided the pot party, preferring something more secure and lucrative. Wise investment.

JimT
22 March 2021 9:10 am

They wanted to be the biggest grower of Marijuana plants in Canada…”

My recollection is that they intended to become the biggest indoor hydroponic operation in Canada. That would allow many other companies to be bigger – potentially much bigger – so long as they weren’t both indoors and hydroponic.

Frenchy
21 March 2021 10:52 pm

The whole thing was a joke and a scam from day one. The Music Man comes to mind.
How about a “thumbs down” from all those who believed this bovine scat. 🙂

Last edited 4 months ago by Frenchy
Are_n
Reply to  Frenchy
22 March 2021 8:51 am

Does this mean that there’s no monorail coming either?

Frenchy
Reply to  Are_n
22 March 2021 8:58 am

Restoring the Rochester cruise is off the table for a while too.

comment image

Last edited 4 months ago by Frenchy
Andy Gray
Reply to  Frenchy
22 March 2021 10:31 am

Nice picture. I remember as a young boy, with my parents,travelled to Rochester on the ferry at least twice. Not sure how successfull a restoration would be at this point.

Sandpiper
Reply to  Frenchy
22 March 2021 10:40 am

yes our Mayors do a great song and dance

Frenchy
Reply to  Frenchy
22 March 2021 7:39 pm

👎 That you Wally?

Last edited 4 months ago by Frenchy
Conor
21 March 2021 4:08 pm

Seems to me this place has gone to the dogs.