Creso Pharma shares entered a trading halt yesterday (Tuesday, November 16) after the office of non-executive chairman Adam Blumenthal’s corporate advisory firm EverBlu Capital was raided by the Australian Federal Police (AFP).
Shares in the cannabis company fell 9% to 12.3 cents before being placed into a trading halt which will stay in effect until Creso makes an announcement to the market, or the start of trading on Thursday (November 18).
Blumenthal doubles as EverBlu’s executive chairman and it was its Sydney office which was raided, not that of Creso Pharma.
This morning (Wednesday, November 17), the Australian Financial Review (AFR) is reporting Creso is “not aware” of any information that would explain the steep fall in its share price and large increase in trading volumes.
Responding to an ASX price query on Tuesday night, it said it was aware of the raid but “is yet to be able to independently verify the nature of the enquiry or determine whether the matter relates to Creso Pharma Limited”.
“The company confirms, however, that it has not been served with any notices from any regulatory body in connection with the matter.”
“As a result, the company does not consider there to be any basis for it to make a public announcement in relation to this matter.“
According to the AFR, EverBlu Capital’s Sydney office was among several sites in Sydney and the Gold Coast raided by the AFP as part of a wide-ranging corporate investigation.
Neither the AFP nor the Australian Securities and Investments Commission (ASIC) have given any further details on the nature of the probe.
The news comes shortly after Creso announced its Swiss operation had recorded revenue of A$817,000 so far this quarter, a 126% increase on the previous three-month period.
The company said the division was “well placed” to exceed last year’s revenue result, with 117% growth to date.
UPDATE (Thursday, November 18, 9:54 am): Creso shares are currently trading at 11 cents.