Bruce Linton had one idea that he believed could solve embattled cannabis producer CannTrust Holdings Inc.’s recent regulatory woes.

The former co-chief executive officer and founder of pot giant Canopy Growth Corp. told BNN Bloomberg in an interview Tuesday that he advised executives at Sundial Growers Inc. to pursue an acquisition of CannTrust assets prior to the Alberta-based company’s initial public offering on the Nasdaq exchange last month.

“I tried to reach out and say, ‘Guys, why don’t you stop going public, buy the assets, settle it with Health Canada and make sure everyone is happy with it and go public with those things in it,’” Linton said. “Obviously, that didn’t happen.”

On July 8, CannTrust said it was found to be non-compliant following a Health Canada inspection conducted a month earlier. As a result of that infraction, Health Canada seized nearly 5,200 kilograms of cannabis believed to have been grown in unlicensed rooms, while CannTrust said it voluntarily set aside another 7,500 kilograms at another facility as it awaits a review and potential enforcement from the federal regulator.

Since then, the company fired CEO Peter Aceto with cause, demanded the resignation of chairman Eric Paul, enlisted a special committee tasked with investigating the scandal and hired Greenhill & Co. as a financial advisor to explore a sale of the company, strategic investment or a business combination.

Linton said a deal between Sundial – or any other cannabis company looking to tap public markets – and a company like CannTrust, whose stock plummeted in the wake of its regulatory troubles, was a cheap way to buy discounted infrastructure and become a publicly-traded company.

“If I was a private company getting momentum and I had to differentiate myself in the market before getting listed, doing a transaction that’s like that is going to create a differentiated value,” Linton said. “I bet you’ll get a great deal and you’ll end up with an asset that’s going to produce a lot of cannabis and have a regulator that likes you.”

Linton didn’t comment if his advice to Sundial reached a point where the two companies entertained discussions for a potential merger. A spokesperson with Sundial wasn’t immediately available for comment.

“It’s one of those things that’s obvious to do, but just hasn’t gotten done,” he added.

BNN Bloomberg reported in July that at least two Canadian cannabis producers were approached by bankers to gauge interest in acquiring CannTrust. As well, another cannabis producer reached out to federal regulators to determine whether it would be amenable for a company to acquire CannTrust amid its regulatory infractions.

Health Canada has yet to take any enforcement action on CannTrust, which could range from a warning letter, a fine of up to $1 million, to the suspension or complete revocation of its licences.

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