Sundial Growers (NASDAQ: SNDL) this morning announced the “sale” of its Bridge Farm UK asset, less than one year after having acquired it. The property was sold to a group of investors that include former members of Sundial management for total consideration of $90 million, although no cash will be provided to Sundial for the asset.
Consideration for the asset will consist of the purchasers taking on $45 million in debt under Sundial’s currently outstanding $115 million credit facility, as well as taking on the contingent consideration liabilities related to the remaining earn-out on the asset. Certain former members of management will also see 2.7 million common shares of Sundial cancelled.
The closing of the arrangement is conditional on Sundial being able to restructure the remaining $70 million in debt from its credit facility, while also entering a new syndicated credit facility by June 1, 2020. If the company fails to enter such an arrangement, it will “likely result in the acceleration of our outstanding debt and would have a significant negative impact on the Company’s liquidity and further impact the Company’s ability to operate as a going concern.”
Sundial closed on the acquisition of Bridge Farm UK in July 2019 for $129.2 million, however it has since wrote off $100.3 million in goodwill associated with the asset due to things not going as planned. Now, less than a year later, the company is disposing of its facility and international plans as a whole as it looks to simply survive.
Sundial Growers last traded at $0.39 on the Nasdaq.
Information for this briefing was found via Sedar and Sundial Growers. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
