Kentucky hemp processing company Atalo Holdings has filed for bankruptcy, the Lexington Herald Leader reports. Atalo CEO Bill Hilliard said in a statement that the move comes after “a failed capital commitment, which left the company unable to pay its creditors.”
He added that “confounding guidance from regulatory agencies,” and “unforeseen market forces” forced the Chapter 7 filing. Atalo was one of the first companies licensed in the state following the creation of a pilot hemp cultivation program in 2014.
Atalo had partnered with GenCanna Global last year and the companies had jointly operated a 147-acre Hemp Research Campus in Clark County that employed 100 people. Last month, GenCanna filed for Chapter 11 bankruptcy but is allowed to continue operations during the process.
Atalo’s assets will be sold under the Chapter 7 filing but officials told Hemp Today that they hope to continue operations during the proceedings and that the company has assets between $10 million and $50 million against liabilities of $1 to $10 million.
In January, another Kentucky hemp company owner, William Riddle of Sunstrand, filed for Chapter 7 bankruptcy to liquidate the company, according to the Herald-Leader. In that case, Riddle and Sunstrand report between $100,001 and $500,000 in assets but more than $10 million in debts to municipal and county agencies, both the Kentucky and Indiana department of revenue, the Kentucky Labor Cabinet, and the Internal Revenue Service, along with several lenders, the report says.
In Kentucky, more than 1,000 cultivators and more than 200 processors received hemp business licenses last year. University of Kentucky agricultural economists estimate the state’s producers could have earned between $55 million and $65 million from last year’s crop.
Kentucky Agricultural Commissioner Ryan Quarles in January sent a letter to the U.S. Food and Drug Administration saying that the agency’s “inability to make regulatory decisions is preventing growth in the hemp marketplace.” The letter urged regulators to “develop a model regulatory framework for oversight of the processing of hemp and manufacturing of Cannabidiol (CBD) which will protect public health, comply with federal law, and foster growth in the industry.”
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Original Source: Kentucky Hemp Firm Files for Bankruptcy
Content Credits: Originally written by TG Branfalt and published to Ganjaprenuer.com on 2020-03-19 14:23:51.