Alcanna Announces Agreement to Acquire 28 Solo Liquor Stores, All Trademarks and Brand
May 27 2019 - 8:00AM
Alcanna Inc. (the “Company” or “Alcanna”) (TSX: CLIQ) today
announced that the Canadian Liquor Retailers Alliance Limited
Partnership (the “Alliance”), which Alcanna owns approximately 71%
of, has entered into an agreement with FTI Consulting Canada Inc.
in its capacity as of May 1, 2019 as court-appointed receiver and
manager of the assets, properties and undertakings of Solo Liquor
Stores Ltd. and Solo Liquor Holdings Ltd.
Under the terms of the agreement, the Alliance
will acquire the underlying assets of twenty-eight (28) stores
currently operating as Solo Liquor, three (3) additional leased
locations that have not yet been opened, the “Solo Liquor” brand
and related trademarks in exchange for $12.4 million plus inventory
estimated at $3.4 million. The acquisition, which will be funded by
the Company’s existing credit facilities, is anticipated to close
in late June 2019.
Alcanna and the Alliance analysed each of the
approximately 90 Solo locations currently operating, recently
closed or with unconditional leases and selected the 28 operating
stores and 3 leases which best fit the existing network of Ace and
Liquor Depot stores. Twenty-two (22) of the twenty-eight (28)
stores being acquired were opened for a full year in 2017, which
was the last full year of operations before Solo encountered
financial and operational difficulty, and reported total sales of
approximately $84.5 million and $5.8 million of in-store/4-wall
EBITDA in that year.
The completion of the transaction is subject to
customary conditions for a transaction of this nature including,
amongst other things, the Court granting an approval and vesting
order transferring the assets that are the subject of the Purchase
Agreement prior to June 30, 2019.
ABOUT ALCANNA INC.
Alcanna is one of the largest private sector
retailers of alcohol in North America and the largest in Canada by
number of stores – operating 236 locations in Alberta, British
Columbia and Alaska. The Company also operates six cannabis retail
stores under the “Nova Cannabis” brand, with five locations in the
Province of Alberta and one the Province of Ontario. With revenues
in excess of $700 million per year, Alcanna processes over 20
million individual retail transactions of beverage alcohol and
cannabis.
Alcanna's common shares and convertible
subordinated debentures trade on the Toronto Stock Exchange under
the symbols "CLIQ" and "CLIQ.DB", respectively.
Additional information about Alcanna Inc. is
available at www.sedar.com and the Company’s website at
www.alcanna.com.
FORWARD-LOOKING STATEMENTS
This news release contains forward-looking
statements or information (collectively "forward-looking
statements") within the meaning of applicable securities
legislation. Forward-looking statements are typically identified by
words such as “intend”, “anticipate”, "will", "should", “plan”,
“expect” and similar words suggesting future events or future
performance. All statements and information other than statements
of historical fact contained in this news release are
forward-looking statements. In particular, this news release
contains forward-looking statements pertaining to: the anticipated
closing of the transaction to acquire the assets from Solo Liquor,
and the Court granting an approval and vesting order. Although the
Company believes that the expectations reflected in the
forward-looking statements, and the assumptions on which such
forward-looking statements are made, are reasonable, there can be
no assurance that such expectations and assumptions will prove to
be correct. Readers should not place undue reliance on
forward-looking statements included in this news release.
Forward-looking statements are not guarantees of future performance
and involve a number of risks and uncertainties that may cause
actual performance and financial results to differ materially from
any estimates, forecasts or projections. These risks and
uncertainties include, among other things: the risk that the
Purchase Agreement will not be approved by the Court, and the other
factors described in the Company’s public filings (including the
Annual Information Form) available at www.sedar.com. Readers are
cautioned that this list of risk factors should not be construed as
exhaustive. The forward-looking statements contained in this news
release are made as of the date hereof. Except as expressly
required by applicable securities legislation, Alcanna does not
undertake any obligation to publicly update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise. The forward-looking statements
contained in this news release are expressly qualified by this
cautionary statement.
For Further Information
James BurnsVice Chair and Chief Executive
OfficerAlcanna Inc. (587) 460-1026james.burns@alcanna.com
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