Cannabist Co Holdings Inc. (CBSTQ) presents a deeply negative liquidation recovery posture as of September 30, 2025. Book equity is already negative at -$152.9M (vs. -$30.1M at December 31, 2024), and haircut-adjusted asset values widen the deficit materially. Total assets are $536.5M against total liabilities at face value of $689.5M, yielding a GAAP book deficit of $152.9M before any liquidation haircuts are applied. Applying standard liquidation haircuts: cash of $17.8M recovers at 100% ($17.8M); restricted cash $3.1M at 100% ($3.1M); accounts receivable $15.4M at 90% ($13.9M); inventory $66.8M at 60% ($40.1M); PP&E net $209.0M at 60% ($125.4M); finite-lived intangibles net $39.3M at 0% ($0); operating ROU assets $96.8M at 0% ($0); finance ROU assets $21.1M at 0-10% (negligible); assets held for sale $30.0M at level-3 fair value per filing, but with lease liabilities embedded of $13.6M and significant uncertainty on buyer-dependent intangibles, effective recovery is uncertain. Other noncurrent assets $12.9M are largely deposits and notes receivable, modest recovery. Total estimated liquidation asset recovery is approximately $200-225M against $689.5M of liabilities at face value, producing an estimated liquidation deficit to equity of approximately -$465M to -$490M. This is broadly consistent with the MFFAIS cash liquidation value of -$527.9M. Key drivers of the negative recovery: (1) $299.3M in long-term debt (2028 Notes and 2028 Convertible Notes at face value), (2) $104.9M in operating and finance lease liabilities, (3) $94.8M in other long-term liabilities (primarily sale-leaseback obligations), (4) $86.97M in accrued income taxes payable (current), and (5) near-zero recovery on $39.3M net intangibles and a large ROU asset base that extinguishes on windup. Since the prior filing (June 30, 2025), total equity deteriorated from approximately -$49M (implied from 6-month net loss of $109.6M added to December 2024 balance) to -$152.9M, driven by $124.2M net loss for the nine-month period. The company has disclosed going concern doubt, with only $20.9M cash and restricted cash, negative operating cash flow of $35.7M YTD, and $1,309.8M accumulated deficit. A Special Committee of the Board is reviewing strategic alternatives including asset sales and mergers. Post-period, the company completed sale of the Florida cultivation facility for $11M (November 10, 2025) and a New Jersey property for $2.55M. Filing discusses section 280(e) federal tax risk and A&R Indenture covenant requirements including a $15M minimum cash covenant commencing March 31, 2026. The $86.97M accrued income tax payable is the largest single current liability and reflects the distortive effect of IRC 280(e) on cannabis operators. Filing does not separately XBRL-tag the sale-leaseback liability as a distinct line item; the $94.8M in OtherLiabilitiesNoncurrent is described in MD&A as primarily sale-leaseback commitments totaling $197.3M undiscounted.
▼ Community Notes