What happened
It's safe to say that Canadian marijuana stock Cronos Group (CRON 3.60%) didn't provide much of a buzz to its investors on Thursday. Following an all-too-brief spike in its price following a media report that it might be putting itself up for sale, the stock ended the day more than 4% lower.
So what
On Thursday afternoon, Reuters published an exclusive article -- citing "people familiar with the matter" -- that Cronos is exploring strategic options that include a sale.
Several hours later, Cronos effectively confirmed this in a tersely worded press release. It expanded on Reuters' reporting, saying that it had received "a number of unsolicited indications of interest from third parties, each regarding a potential transaction involving Cronos and the third party."
The cannabis company added that it is currently in the opening stages of evaluating these proposals.
Cronos did not offer further details about any of them, nor did it specify how many it has received. Reuters reported that the company has retained a financial advisor to assist it in the transition process. The news agency's sources named U.S. marijuana company Curaleaf as one of the interested parties.
Now what
Cronos is one of a clutch of marijuana companies struggling with profitability and cash flow in the overcrowded Canadian market. Investors likely realized that the company is unlikely to fetch a premium to its share price in any sale.
As with any speculation on a company's sale or other major strategic moves, investors should bear in mind that such situations can be fluid and subject to change at any time.
