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Creso Pharma (ASX:CPH) - Adam Blumenthal
Adam Blumenthal
Source: EverBlu Capital
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  • Adam Blumenthal will stand aside as chairman of Creso Pharma (CPH) to distance the company and its operations from an ongoing ASIC investigation
  • CPH says it appears to have become involved in the probe due to common directorships with its corporate adviser, EverBlu Capital, of which Mr Blumenthal is chairman
  • “Creso Pharma takes its legal obligations seriously, and is treating this matter accordingly, including to comply with ASIC’s Notice,” the company said
  • Importantly, the ASIC probe has no impact on Creso Pharma’s capacity to continue operating efficiently
  • Shares in Creso are down 7 per cent to 9.3 cents at 2:00 pm AEDT

Adam Blumenthal will stand aside as chairman of Creso Pharma (CPH) to distance the company and its operations from an ongoing ASIC investigation.

“Creso Pharma appears to have become involved in the ASIC investigation because of common directorships between it and its corporate adviser, EverBlu Capital,” the comapny said. Mr Blumenthal is chairman of EverBlu Capital.

ASIC has served Creso with a notice requesting it to disclose certain documents to ASIC in conjunction with an investigation.

For the first time, the notice stated that ASIC’s investigation covers potential violations by the company, its officers, agents, employees, and representatives in connection with trading in its securities.

“Creso Pharma takes its legal obligations seriously, and is treating this matter accordingly, including to comply with ASIC’s Notice,” the company said.

Creso said the notice confirmed that “it should not be construed as an indication by ASIC that a contravention of the law has occurred, nor should it be considered a reflection upon any person or entity”.

The company sought a two-day trade stop on Tuesday. On Thursday morning, Creso said it had received a notification from ASIC.

Importantly, the ASIC probe has no impact on Creso Pharma’s capacity to continue operating efficiently.

Dr James Ellingford, Creso Pharma’s Executive Director, will serve as temporary chairman. Furthermore, the board of directors has formed a separate subcommittee, comprised of Dr Ellingford and Co-Founder Boaz Wachtel, to discuss and react to the ASIC notice, as well as to otherwise assist with ASIC in its enquiry.

The company adds that its important business activities in Canada and Switzerland are controlled by in-country senior executives who have been isolated from this subject, and as a result, those operations are unaffected and continue to operate normally.

“The company appreciates and is grateful for the continued support of all of its stakeholders,” the company said.

Shares in Creso are down 7 per cent to 9.3 cents at 2:00 pm AEDT.

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