Board warfare and allegations of financial impropriety have erupted at Australian marijuana business Epsilon Healthcare, putting at risk 25 jobs and the largest medicinal cannabis manufacturing facility in the southern hemisphere.
Epsilon announced on December 17 that it had appointed administrators Ian Purchas and Hugh Armenis from SV Partners to take control of the company and conduct an ‘urgent assessment of the company’s business operations and financial affairs’.
Mr Purchas said the ‘underlying’ businesses were strong and the move into administration had come about due to ‘disunity’ at board level.
‘They (a majority of the board) formed the view the uncertainty at the board level may cause creditors to make claims, which the company may not have been able to pay,’ he said.
The company’s ASX announcements in recent months reveal a chaotic shuffle of board and management positions and allegations of potential financial impropriety.
Epsilon Healthcare manufactures medicinal cannabis products at a facility at Southport on the Gold Coast. The company entered into administration on December 17
On November 20, the company’s deputy chairman Alan Beasley proposed an extraordinary general meeting (EGMS) to appoint Peter Giannopoulos as a director of the company and remove Xiao (Josh) Cui as a company director.
Mr Cui is the board’s chair.
On November 21, the company announced Mr Giannopoulos’ termination as chief executive before the end of his probationary period.