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Canadian marijuana producer SNDL will buy the remaining shares of retailer Nova Cannabis for about 40 million Canadian dollars ($29.1 million).
SNDL’s newly acquired shares amount to about 34.8% of Nova’s stock, the Alberta-based companies announced in a Tuesday news release.
Nova shareholders can receive either $1.75 in cash or 0.58 of a common share of SNDL for each of their Nova shares, subject to proration and a maximum of 50% of the aggregate consideration payable in SNDL shares.
Shares of SNDL trade on the Nasdaq.
In November 2023, SNDL and Nova announced they had canceled a strategic partnership in which SNDL would have offloaded 26 stores to Nova.
Instead, Calgary-based SNDL retained majority ownership in Edmonton-based Nova and retained “an administrative services agreement” with the company.
Both companies’ boards approved the deal, according to the release.
“The proposed transaction offers liquidity and certainty to minority shareholders while creating a lasting legacy in a nascent industry,” Ron Hozjan, an independent director at Nova, said in statement.
According to the release, the deal is expected to generate savings by streamlining expenses and optimizing general and administrative costs.
“We are committed to building a consumer-centric model at scale, supported by SNDL’s robust shared service model, access to capital and a well-develop9ed cannabis retail pipeline,” SNDL Chief Executive Officer Zach George said.
“These factors are integral to the achievement of sustained profitable growth.”
