Sundial Growers Finally Closes Purchase Of Alcanna

Sundial Growers (NASDAQ: SNDL) has finally closed on its much-delayed purchase of retailer Alcanna Inc (TSX: CLIQ). The transaction saw the cannabis firm pay a total of $320 million in cash and shares to acquire the retailer.

The transaction is rather significant for Sundial, given Alcanna’s role as one of the largest alcohol retailers in the country, and one of the largest in North America. The company also owns a majority stake in Nova Cannabis, a Canadian cannabis retailer, whom is a competitor of Sundials current retail cannabis operations.

Alcanna currently operates 171 retail locations, which are predominantly found in Alberta, while Nova Cannabis operates 78 retail cannabis operations. Collectively, the company generated positive cash flow from operating activities in 2021 of $18.3 million. More importantly, Sundial now owns or operates over 180 cannabis retail locations in Canada, which appears to be one of the primary motives behind the transaction.

The transaction itself saw shareholders of Alcanna receive 8.85 Sundial shares for each Alcanna share held, as well as $1.50 in cash. Alcanna shareholders on a combined basis own a 13.4% stake in Sundial on a post-transaction basis. Alcanna shares are expected to cease trading on April 4 as a result of the transaction.

Separately, Nova Cannabis (TSX: NOVC) this morning announced that it had seen major management changes as a result of the acquisition of its majority holder by Sundial. James Burn, Thomas Bitove, Ross Sinclair, Marvin Singer and Darren Karasiuk all resigned from the board of directors, while Karasiuk also resigned as President and CEO.

Current COO, Marcie Kiziak, as a result was named as the new CEO of the company as well as named as the President of Cannabis Retail at Sundial. The new board now consists of Sundial CEO Zach George as Chair, along with Anne Fitzgerald, Marcia Kiziak, Christopher Pelyk, Jeffrey Dean, and Share Mogk-Edwards, as well as Ron Hozjan, the only prior member to remain on the board.

The company has also sold all 21 of its Ontario retail cannabis locations, due to regulations in the province related to producers owning retailers. Instead, the retailers will operate under a brand licensing and services agreement, while Nova will hold a re-purchase option on them as well. The locations were sold to Spirit Leaf Ontario, for a total of $11.0 million.

Sundial Growers last traded at $0.72 on the Nasdaq.


Information for this briefing was found via Edgar and the companies mentioned. 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.

Video Articles

Gold/Silver: People Can Still Lose Money In This Bull Market!? | Rick Rule

He Said $300 Silver!? | Peter Krauth

Dollar Will Collapse, Gold and Silver Are the Only Safe Havens | Jim Rogers

Recommended

Tsunami Warnings Spread As Largest Quake Since 2011 Hits Russia

Northern Superior Intersects 1.75 g/t Gold Over 65.0 Metres At Philibert

Related News

Sundial Revenues Fall 36% To $12.9 Million, Reports Loss Of $71.4 Million In Q3

Sundial Growers (NASDAQ: SNDL) this evening reported its third quarter 2020 financial results, posting revenues...

Wednesday, November 11, 2020, 07:25:07 PM

Sundial: Analysts Expect Positive EBITDA For Q3 2021

Sundial Growers (NASDAQ: SNDL) announced that they will be reporting their third quarter financials after...

Tuesday, November 9, 2021, 05:18:00 PM

Stifel-GMP: SNDL Acquiring Valens “Does Not Come As A Surprise”

On August 22, SNDL Inc (NASDAQ: SNDL) announced that it would be acquiring Valens Company...

Friday, August 26, 2022, 04:13:00 PM

SNDL Begins Exit Of Canadian Cannabis Retail Via Licensing Model With Nova Cannabis

SNDL (NASDAQ: SNDL) is evidently looking to gracefully exit the Canadian cannabis retail market. The...

Wednesday, December 21, 2022, 07:55:03 AM

Zenabis Enters $60 Million Credit Facility To Pay Off Sundial Debt

Zenabis Global (TSX: ZENA) this morning announced that it has entered into a credit agreement...

Friday, January 22, 2021, 08:21:31 AM