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Sundial Growers to acquire Alcanna Inc. for $346 million

Tiger Newspress2021-10-08

Sundial Growers stock surged 19% in extended trading after announcing that it would acquire Alcanna Inc. for $346 million.

Sundial Growers Inc. announced today that it has entered into an arrangement agreement with Alcanna Inc. pursuant to which Sundial will acquire all of the issued and outstanding common shares of Alcanna by way of a statutory plan of arrangement for total consideration of approximately $346 million.

With over 25 years of experience in retailing regulated products, Alcanna isCanada'slargest private liquor retailer, operating 171 locations predominantly inAlbertaunder its three retail brands "Wine and Beyond", "Liquor Depot" and "Ace Liquor". Alcanna's strategic partner, in which it holds an approximately 63% equity interest, Nova Cannabis Inc., is one ofCanada'slargest cannabis retailers offering a wide range of high-quality cannabis products at value prices. Nova currently operates 62 stores acrossAlberta,SaskatchewanandOntarioprimarily under the "Value Buds" and "Nova Cannabis" banners.

KEY TRANSACTION HIGHLIGHTS

  • Improved cash flow profile with expansion into liquor:Alcanna's longstanding liquor business provides Sundial with stable cash generation through a mature and proven business model with trailing twelve months free cash flow of$16.4 millionon a built-out retail platform.
  • Enhanced exposure with investment in Nova, a publicly listed, pure-play cannabis retail operator:Sundial's current retail network combined with Nova's store count implies that the combined company will be a Canadian cannabis retail market leader with more than 170 locations. This network strengthens Sundial's position as a partner to the industry and represents a critical route to market for Canadian licensed producers.
  • Synergies from a larger retail operation:The robust corporate support function at Alcanna is expected to supplement Sundial's Spiritleaf retail operations. It is estimated that the transaction will deliver more than$15 millionof additional EBITDA on an annual run-rate basis through synergies and other strategic initiatives.
  • Alcanna shareholders to participate in and help create the future of Sundial:Alcanna shareholders are to receive Sundial common shares in an all-stock transaction. The transaction will provide Alcanna shareholders with exposure to Sundial's core cannabis operations inCanadaand investment operations focused on deploying capital within the cannabis sector through its joint venture in SunStream Bancorp Inc. Beyond improved liquidity and the ability to position for further retail expansion, Sundial's balance sheet strength provides a unique opportunity for Alcanna shareholders to participate in investment growth in the regulated product sector.

"This made-in-Albertatransaction allows Sundial to further its mission to own the customer relationship and deliver sustainable value to shareholders," saidZach George, Chief Executive Officer of Sundial. "Alcanna's value-focused model in liquor retailing has created market stability and we believe that the replication of this playbook in cannabis has strong potential to drive a similar result. We intend to position all of our retail exposure for profitability and strive to work with Canadian licensed producers in order to delight consumers with quality cannabis products."

"We believe this agreement is a testament to the value created by everyone at Alcanna and will be beneficial to all of our stakeholders," saidJames Burns, Vice Chair and Chief Executive Officer of Alcanna. "We have been successful at achieving customer loyalty, and operating at levels of efficiency that are industry-leading and Sundial will provide great opportunities as a larger and significantly more liquid company. We look forward to working with Sundial to complete this transaction."

Under the terms of the Agreement, Alcanna's shareholders will receive, for each Alcanna common share held, 10.69 common shares of Sundial (each whole share, a "Sundial Share") (based on the trailing 10-day volume-weighted average price ("VWAP") of the Sundial Shares on the NASDAQ Capital Market prior to the date of this press release), representing a deemed value of$9.12per Alcanna Share. The purchase price of$9.12per Alcanna Share represents a premium of 39% to the 10-day VWAP of the Alcanna Shares on the Toronto Stock Exchange (the "TSX") preceding the signing of the parties' non-binding letter of intent onSeptember 1, 2021and a premium of 23% to the 10-day VWAP of the Alcanna Shares on the TSX preceding theSeptember 15, 2021press release regarding recent trading activity (unaffected date). The Transaction has been unanimously approved by the boards of directors of Sundial and Alcanna and is expected to close inDecember 2021or in the first quarter of 2022.

免责声明:本文观点仅代表作者个人观点,不构成本平台的投资建议,本平台不对文章信息准确性、完整性和及时性做出任何保证,亦不对因使用或信赖文章信息引发的任何损失承担责任。

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评论25

  • JoelLee
    ·2021-10-11
    Wowowow
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  • seojun
    ·2021-10-11
    Should we??
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  • Chaishen
    ·2021-10-08
    What should be the value price now 🤔 
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  • HeroSmurf
    ·2021-10-08
    Overnight plants to gold 💰
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    收起
    • Mml
      Yup
      2021-10-10
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  • Kel9670ong
    ·2021-10-08
    Time to profit from sundial
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    收起
    • Guardian_J
      great. haha.
      2021-10-08
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  • cutemiao
    ·2021-10-08
    Informative.
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    • Angsana
      like
      2021-10-08
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  • EagleE
    ·2021-10-08
    Wow! 
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  • Huat Huat Al
    ·2021-10-08
    Huat Huat all
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  • AngieAbcde
    ·2021-10-08
    I wana dump this too
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    收起
    • Etet1985
      same
      2021-10-08
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    • AngieAbcde
      Ave Down now is dangeroUs ?
      2021-10-08
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    • seojun
      hmmm
      2021-10-11
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  • CIG
    ·2021-10-08
    Game played by big fishes. Small fish should swim away.
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  • Chimmy
    ·2021-10-08
    Good news. Hope it gets up to around 0.95 and I will dump the bags I have been holdingfor long
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    • PengsieX
      All the best!
      2021-10-08
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  • JY00
    ·2021-10-08
    Interesting 
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  • albert77
    ·2021-10-08
    nice go go
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  • sickeninglim
    ·2021-10-08
    Wow.......
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    • JY00
      Woohoo
      2021-10-08
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  • Leefh888
    ·2021-10-08
    👍 
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  • SquareGuy
    ·2021-10-08
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  • franklinzy
    ·2021-10-08
    Still not a good stick to buy
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  • 2020TS
    ·2021-10-08
    Long term horizon, fail to expand own market share aft issuing billion of shares. Need raise fund again and diluting share value.
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    • Bull_Lion
      I‘m not optimistic with SNDL. Just need the price to lift above $1 for me to get out
      2021-10-08
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    • YCLim
      me too
      2021-10-08
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    • Bull_Lion
      Good luck to you too, buddy 👍🏼
      2021-10-08
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  • Dynamism
    ·2021-10-08
    K
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    收起
    • 3d468733
      Ok
      2021-10-08
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  • 23a2d027
    ·2021-10-08
    wow
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