Finally, the long wait is over as after almost radio silence on spinoff measures and months of anticipation, Creative Edge Nutrition Inc (OTCMKTS:FITX) reported the successful spinoff of its unit CEN Biotech Inc. The new firm’s CEO and President will be former Creative Edge CEO Bill Chaaban. The news comes at the back of Bahige Chaaban’s letter to shareholders which revealed that the business plan CEN Biotech had two years ago was still present in the company’s to-do list.
The press release reveals that on November 30, 2015 Creative Edge shareholders will get 1 share of CEN Biotech for each 700 shares held of Creative. The new firm’s shares will consists of 100,000 preferred shares and 6.9 million common shares. CEN Biotech is planning to list on the QB tier of the OTC Marketplace, while Creative Edge will continue to trade as a pink sheet stock.
CEN opted for a CPA performed audit and provided the statements in a U.S. SEC filing. Here, the most important question is how it will perform once it gets listed as a separate entity. Even though the Chaaban’s letter to shareholders and the latest press release highlight the pending lawsuit against Health Canada and its verdict to deny Creative Edge a license to cultivate medical marijuana, there is little specifics and clarity on the subject.
The picture is that after series of assurances, promises, and build out photos released by the company, Creative Edge shareholders who were purchasing the company’s stock at $0.10 per share last year, have to face disappointment with Health Canada denial of a license. With the imminent share distribution, the remaining supporters of Chaaban’s vision are still expecting things to change for better in coming period.
Creative Edge Nutrition Inc (OTCMKTS:FITX) enjoyed a very peasant session yesterday as it closed with a gain of 39.53% at the end of the day. The volume surged to 103 million, considerably higher than the daily average of 14 million, reflecting a serious leap on the part of the buyers but it may still turn out to be inadequate. The opening gap and the surging volume support the bulls but the risk comes in the form of the channel resistance, as shown on the chart attached. If that upper boundary of the channel is overcome immediately, then the bears can push the price down.