Sundial Growers Inc. (NASDAQ: SNDL) announced today that it has entered into an agreement with Inner Spirit Holdings Ltd. (CSE: ISH) to acquire the company in a transaction pegged at $131 million. Inner Spirit wholly owns the Spiritleaf cannabis retail store network.
The acquisition price is estimated at approximately $131 million, or $0.39 per share. Shareholders of Inner Spirit are to receive $0.30 in cash and 0.0835 of a Sundial common share for each share held, with total consideration on a per share basis expected to amount to $0.39.
The $0.39 purchase price per Inner Spirit share is both a premium of 54.7% to its 10-day volume-weighted average share price and 62.5% to its closing price on May 4, 2021.
The agreement also stipulates a reciprocal termination fee of $4 million in the event that the transaction is canceled due to predetermined circumstances.
Inner Spirit’s subsidiary Spiritleaf has a retail network of 86 stores operating across Canada. The cannabis retail store brand expects to exceed the 100-store milestone in the summer of 2021.
The transaction has been both approved by Sundial and Inner Spirit’s boards and is expected to close in Q3 2021 following the approval by shareholders.
The transaction is notable for Sundial, whom yesterday announced that it had taken a 10.1% stake in The Valens Company (TSX: VLNS), which follows an investment in Indiva (TSXV: NDVA) that saw Sundial take an 18.45% position.
Sundial Growers Inc. last traded at US$0.79 on the Nasdaq.
Information for this briefing was found via Sedar 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.