Sundial Growers (NASDAQ: SNDL) appears to be hanging on by a thread. Last night, on the day that certain milestones were supposed to be completed by, the company issued a release indicating that its lenders had agreed to push certain waiver agreements until April 30.
Referred to by the company as the “collaborative relationship between Sundial and its lenders,” Sundial now has a two week extension to perform certain actions. If it fails to, the company will have defaulted on its currently outstanding $177.9 million in debt.
The milestones referred to above by the company essentially amount to Sundial being required to enter a definitive agreement for the sale of its Bridge Farm UK assets. Originally acquired last July for $129.9 million, the company has since impaired the value of the asset by $100.9 million, or 79.03%. Now, the current providers of Sundial’s outstanding credit facility are forcing the sale of the asset to bring Sundial back in line with certain covenants included in the facility.
That sale was originally to have occurred by yesterday, April 15. The company is also required to have entered term sheets with each respective lender outlining a financing strategy for the struggling firm. The situation for Sundial is so dire that last Thursday they announced they would be curtailing certain cultivation and harvesting functions as a means of conserving cash, while also laying off a portion of its staff.
Sundial Growers last traded at $0.58 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.
As the founder of The Deep Dive, Jay is focused on all aspects of the firm. This includes operations, as well as acting as the primary writer for The Deep Dive’s stock analysis. In addition to The Deep Dive, Jay performs freelance writing for a number of firms and has been published on Stockhouse.com and CannaInvestor Magazine among others.