Finance

HEXO CEO reportedly ousted following a shareholder letter questioning his leadership abilities.

ChainVerse January 17, 2025

Table of Contents

Report Highlights Investor Concerns Over HEXO’s Financial Performance

Hexo Corp. co-founder Sebastien St-Louis has been ousted from his role as chief executive officer after an investor alleged the company "has not acted in the best interest of its shareholders" under his leadership, according to a report by BNN Bloomberg.

Shareholder Letter Criticizes HEXO’s Financial Performance

In a letter to the board of directors, Adam Arviv expressed concerns over St-Louis’ leadership and questioned several decisions made by the company. "You continuously make negligent decisions and deliver poor financial performance," Arviv stated in the letter.

Arviv also alleged that St-Louis had over-leveraged HEXO to help finance deals to acquire cannabis operators Zenabis Global Inc. and 48North Cannabis Corp. The investor claimed that these decisions were detrimental to the company’s growth and profitability.

HEXO Responds to Shareholder Concerns

In response to the shareholder letter, HEXO spokesperson Sarah Brown stated that "notwithstanding Mr. Arviv’s letter, this was the right time to make this change." Brown emphasized that St-Louis’ departure marked a new stage in the company’s strategic evolution and presented an opportunity for a new leader to drive growth and profitability.

Board of Directors Votes to Oust St-Louis

According to BNN Bloomberg, HEXO’s board unanimously voted to dismiss St-Louis from his duties. A person familiar with the matter confirmed that the decision was made following Arviv’s letter and concerns over St-Louis’ leadership.

Industry Experts Weigh In on HEXO’s Future

The cannabis industry has been facing significant challenges in recent years, including declining revenue and increased competition. HEXO’s writedown on "cannabis trim" raised eyebrows among investors and experts alike, sparking concerns about the company’s financial stability.

As the sector continues to grapple with regulatory changes and market fluctuations, some industry experts believe that a new leadership could be just what HEXO needs to drive growth and profitability. However, others caution that replacing St-Louis may not be enough to address the underlying issues facing the company.

What’s Next for HEXO?

With Sebastien St-Louis out as CEO, attention will now shift to the company’s new leader and their plans for the future. As the cannabis industry continues to evolve, investors and experts alike will be watching closely to see how HEXO navigates its next chapter.

Key Takeaways

Hexo Corp.’s co-founder Sebastien St-Louis has been ousted from his role as CEO after a shareholder letter questioned his leadership.
Investor Adam Arviv alleged that St-Louis made negligent decisions and delivered poor financial performance, leading to over-leveraging the company.
HEXO’s board of directors unanimously voted to dismiss St-Louis from his duties following the shareholder letter.
The cannabis industry is facing significant challenges, including declining revenue and increased competition.

Cannabis producer HEXO to buy privately held Redecan in deal worth $925 million
Why HEXO’s writedown on ‘cannabis trim’ could be another bad sign for the industry
‘There’s just no money coming in’: Cannabis sector bracing for wave of insolvencies in 2020

Join the Conversation

Share your thoughts and join the discussion on social media using the hashtag #HEXOCO. What do you think is next for HEXO? Will a new leadership be enough to drive growth and profitability, or are there deeper issues that need to be addressed?

Sources

BNN Bloomberg: "Hexo Corp co-founder ousted as CEO after shareholder letter questions leadership"
Yahoo Canada Finance: "Hexo CEO ousted after shareholder letter questioned leadership"