- 3 licensed retail cannabis stores, 2 are currently operating and 1 is expected to open within 45 days (the “Licensed Premises”)
- 5 development permits to build new cannabis retail stores in Calgary, Edmonton, Edson, and Fort McMurray (the “Development Premises”)
- All copyrights, trade marks, digital assets and rights to all KushBar intellectual property
- Deposit of $3.5 million, paid to High Tide through the issue of 13,461,538 Halo Shares
- Under cannabis 2.0, the Canadian market poised to grow from $1.5B to over $3B in 2020 according to Canaccord Genuity2
The Transaction follows Halo and High Tide’s announcement of a strategic partnership in May 2019. This expansion provides Halo with a foothold into the Canadian cannabis market.
Kiran Sidhu, Halo CEO and Co-Founder, added, “We are excited to mark our strategic entry into the Canadian retail cannabis market with this initial Portfolio of assets in Alberta. We look forward to strengthening our relationship with High Tide and benefitting from its expertise in retail store development and operations management.
“Once Halo’s products are approved for sale in Alberta, directly acquiring retail storefronts is expected to give Halo the ability to showcase its branded products to Canadian consumers. The Transaction also creates an opportunity to widen our expected sales base across Alberta’s network of more than 400 retail outlets once Halo’s products are approved for sale in the Province. With recent positive changes in Canadian cannabis legislation, this is the perfect environment for us to enter Canada and further grow our oil and concentrate business. We are expecting to use this acquisition as the foundation to build a larger retail footprint in Canada.”
While Canna Cabana operates across Canada, KushBar is based in Alberta and currently operates 2 retail cannabis stores in Camrose and Morinville, with 1 in Medicine Hat that is due to open in 45 days. The subsequent 5 KushBar stores are set to open in Alberta markets including Calgary and Edmonton, as well as Edson and Fort MacMurray.
To provide continuity and allow Halo to scale the remaining 5 locations, High Tide will continue to operate and manage the retail cannabis stores during a transition period in exchange for a percentage of gross revenues, subject to certain limits. High Tide will also assist Halo through the AGLC licensing process and oversee construction of the 5 new locations pursuant to the terms of a regulatory management agreement entered into between Halo and High Tide and pursuant to a construction management agreement and a retail management agreement that are to be entered into prior to closing of the Transaction.
Halo expect to have sufficient capital to complete the development and construction of the Development Premises using cash on hand or making draws under the Company’s previously announced $10M principal amount unsecured debt financing agreement.
Mr. Sidhu added, “Halo is excited to be entering the Canadian cannabis market as Cannabis 2.0 is initiated throughout the country. KushBar gives Halo the foundation to grow through a known dispensary brand in an attractive and growing retail market. Establishing ourselves in Alberta, one of Canada’s largest cannabis consuming populations, will be the foothold Halo needs to continue Canadian expansion.”
With the deregulation of recreational cannabis for adult use across Canada, Canna Cabana Inc. and its 27 branded stores, is a sizeable retail business with a sophisticated yet playful customer experience. KushBar Inc. is a second retail cannabis business with 2 operating stores in Alberta, offering a modern experience aimed at the growing customer bases in Alberta and Ontario. Based in Amsterdam since 2000, Grasscity.com is the world’s preeminent and most searchable online retailer of smoking accessories and cannabis lifestyle products with approximately 5.8 million site visits annually. Founded in 2009 and approved by the Canadian Franchise Association, Smoker’s Corner Ltd. is among Canada’s largest counter-culture chains with 7 locations. Representing the core of High Tide’s wholesale segment, RGR Canada Inc. is a high-quality and innovative designer, manufacturer and distributor of cannabis accessories. Famous Brandz Inc. is a dominant manufacturer of licensed lifestyle accessories, through partnerships with celebrities and entertainment companies including Snoop Dogg and Paramount Pictures. Famous Brandz’ products are sold to wholesalers and retailers around the world.
www.hightideinc.com and its profile page on SEDAR at www.sedar.com.” data-reactid=”46″>For more information about High Tide Inc., please visit www.hightideinc.com and its profile page on SEDAR at www.sedar.com.
With a consumer-centric focus, Halo will continue to market innovative, branded, and private label products across multiple product categories. Halo recently acquired Dispensary Track platform which will alleviate customer flow constraints experienced by dispensaries and enable direct consumer interaction.
www.sedar.com.” data-reactid=”49″>For further information regarding Halo, see Halo’s disclosure documents on SEDAR at www.sedar.com.
https://www.businesswire.com/news/home/20200214005506/en/” data-reactid=”54″>View source version on businesswire.com: https://www.businesswire.com/news/home/20200214005506/en/
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