181 Employees in the Lurch as $450M Patrick Mahomes’ Shareholding Venture Lies in Jeopardy

A huge number of employees are worried because a business venture where Patrick Mahomes is one of celebrity investors is in grave trouble. One of the investments of the NFL’s two-time Super Bowl champ is teetering on the edge of bankruptcy amid ‘negative cash flow’. The situation has left 181 employees from both the United States and Canada worried and unsure about what will happen to their jobs and livelihoods.

The sports drink company BioSteel, finds itself mired in a financial crisis, grappling with mounting debt, particularly to the NFL. Their struggle to meet financial obligations has raised concerns, particularly for Mahomes, who holds a significant investment in the company.

Patrick Mahomes’s shareholding seeks bankruptcy protection

Founded in 2009 by entrepreneur John Celenza and former NHL player Mike Cammalleri, their brainchild ‘BioSteel’ initially focused on growing its cannabis ventures in both Canada and the United States. Recently missed a payment to the NFL, and they now face an outstanding debt of $12 million from October to March, stemming from their role as the official hydration provider for the NFL.

NFL sensation Patrick Mahomes inked a multi-year deal with BioSteel in 2020. Beyond his investment in BioSteel, Mahomes also maintains stakes in various other brands and sports franchises. A slew of prominent athletes, including Connor McDavid, Connor Bedard, Jalen Ramsey, Ezekiel Elliott, and Sophia Smith, have active endorsement deals with BioSteel.

In response to their precarious financial situation, per reports, BioSteel said, “BioSteel sought creditor protection under the CCAA to conduct a court-supervised sale process for its business and property for the benefit of its stakeholders,” and has filed for bankruptcy protection.

Important to note, that National Hockey League sponsorship also suffers, as BioSteel’s financial woes cast a shadow over their sponsorship of the NHL, where they only recently secured the position of official hydration partner in 2022.

Canopy Growth’s ongoing efforts to reduce BioSteel’s debt?

To save money, BioSteel is about to lay off most of its 181 employees. The company is spending about $15 million every month, and cutting staff is one way they’re trying to reduce their expenses.

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Canopy Growth has made substantial investments in BioSteel and is actively engaged in efforts to reduce the company’s debt burden, seeking to enhance BioSteel’s financial health. Despite making $24 million in sales in Q1 2023, BioSteel caused 60% of this year’s financial losses, hurting Canopy Growth’s profits.

Canopy Growth has been diligently working to slash BioSteel’s debt. They have already achieved significant reductions, with further debt reduction anticipated in the upcoming quarters.

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