This news release constitutes a "designated news release" for
the purposes of the Company's prospectus supplement dated
December 3, 2021, to its short form
base shelf prospectus dated April 22,
2021.
CALGARY, AB, April 1, 2022 /CNW/ - High Tide Inc. ("High
Tide" or the "Company") (Nasdaq: HITI) (TSXV: HITI)
(FSE: 2LYA), a leading retail-focused cannabis company with
bricks-and-mortar as well as global e-commerce assets, is pleased
to announce that it is taking yet another step to expand its
bricks-and-mortar retail cannabis operations, by entering into a
definitive agreement (the "Acquisition Agreement") pursuant
to which High Tide will acquire 100% of the equity interest of
2080791 Alberta Ltd. operating as Boreal Cannabis Company
("Boreal") which operates two retail cannabis stores in
Alberta (the "Stores") for
CAD$2.2 Million, plus the wholesale
value of inventory and cash on hand at closing (the
"Transaction"). The Stores are located at 1104 Main Street
SW in Slave Lake, Alberta, and
4225 50 Avenue in St. Paul,
Alberta. The Slave Lake
store was the first to open in the municipality and is located in a
commercial plaza that is a short walk or drive away from the main
campus of Northern Lakes College, and the Slave Lake Inn and
Conference Centre. The St. Paul
store is situated on the main east-west corridor in the town, as
part of a commercial district that features several national big
box chains and restaurants. For the three months ended January 31, 2022, Boreal generated annualized
revenue of CAD$3.9 Million and
annualized Adjusted EBITDA1 of
CAD$0.6 Million. The purchase price
represents 3.5x annualized Adjusted EBITDA for the three months
ended January 31, 2022.
![High Tide Inc. April 1, 2022 (CNW Group/High Tide Inc.) High Tide Inc. April 1, 2022 (CNW Group/High Tide Inc.)](https://mma.prnewswire.com/media/1778436/boreal.jpg)
"Boreal was one of the earliest players in the northeastern
Alberta cannabis market, having
opened the first store in the community of Slave Lake. This announcement is yet another
example of how we continue to strategically advance our retail
store footprint across Canada
through organic growth and accretive acquisitions with a focus on
regions where we are currently lighter on exposure, such as
northern Alberta which has a
dynamic economy that supports working families, a key consumer
demographic for Canna Cabana," said Raj Grover, President and Chief
Executive Officer of High Tide. "We continue to execute on
opportunities to acquire established stores with good fundamentals
at attractive multiples. Once these acquisitions have closed, we
will have surpassed the 120-store threshold, and will be well on
our way to achieving the 150-store milestone by the end of this
calendar year," added Mr. Grover.
"Through its online consumption accessories sales, value-added
CBD activities, and retail spaces, High Tide has managed to
diversify itself within the cannabis value chain. We strongly
believe Boreal Cannabis is in capable hands, and will continue to
unlock value for not only shareholders, but our customers through
competitive pricing and a customer-centric approach," said
Glenn Boisvert, Chief Executive
Officer of Boreal.
________________________
|
1 Adjusted EBITDA is a non-IFRS
financial measure.
|
TRANSACTION DETAILS
The Transaction, which is an arm's length transaction, is
subject to, among other things, receipt of required TSX Venture
Exchange ("TSXV") approval, Alberta Gaming, Liquor and
Cannabis Commission approval, and other customary conditions of
closing, is expected to close in the coming weeks. The
consideration (the "Consideration") for the Stores being
acquired will be CAD$2.2 Million plus
the wholesale value of the inventory, paid in common shares of High
Tide ("High Tide Shares") on the closing of the Transaction
(the "Closing") on the basis of a deemed price per High Tide
Share equal to the volume weighted average price per High Tide
Share on TSXV for the 10 consecutive trading days preceding
Closing, plus the cash on hand on Closing, paid in cash. The
purchase price represents 3.5x annualized Adjusted EBITDA for the
three months ended January 31, 2022.
Upon the closing of Boreal, as well as the Crossroads and
Bud Heaven transactions announced
last month, High Tide will have at least 121 stores nationwide and
63 stores in Alberta.
ABOUT HIGH TIDE
High Tide is a leading retail-focused cannabis company with
bricks-and-mortar as well as global e-commerce assets. The Company
is the largest non-franchised Canadian retailer of recreational
cannabis as measured by revenue, with 113 current locations
spanning Ontario, Alberta, Manitoba, and Saskatchewan. High Tide was featured in the
third annual Report on Business Magazine's ranking of Canada's Top Growing Companies in 2021 and was
named as one of the top 10 performing diversified industries stocks
in the 2022 TSX Venture 50™. The Company is also North America's first and only cannabis
discount club retailer, featuring Canna Cabana, Meta Cannabis Co.,
and Meta Cannabis Supply Co. banners, with additional locations
under development across the country. High Tide's portfolio also
includes retail kiosk and smart locker technology – Fastendr™. High
Tide has been serving consumers for over a decade through its
established e-commerce platforms including Grasscity.com,
Smokecartel.com, Dailyhighclub.com, and Dankstop.com and more
recently in the hemp-derived CBD space through Nuleafnaturals.com,
FABCBD.com, BlessedCBD.co.uk, and BlessedCBD.de, as well as its
wholesale distribution division under Valiant Distribution,
including the licensed entertainment product manufacturer Famous
Brandz. High Tide's strategy as a parent company is to extend and
strengthen its integrated value chain, while providing a complete
customer experience and maximizing shareholder value.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
For more information about High Tide Inc., please visit
www.hightideinc.com, its profile page on SEDAR at www.sedar.com,
and its profile page on EDGAR at www.sec.gov.
ABOUT BOREAL
Founded in 2019, Boreal Cannabis is built on a foundation of
love, passion, and a strong belief in how cannabis can help in the
lives of everyday Canadians. With equal commitments to quality and
fairness in price, Boreal's mission is to ensure that cannabis
culture is accessible and welcoming for all. Whether it is
providing insight and education or friendly service, Boreal
strongly believes in treating everyone as people, not just
customers.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain information in this news release constitutes
forward-looking statements under applicable securities laws. Any
statements that are contained in this news release that are not
statements of historical fact may be deemed to be forward-looking
statements. Forward-looking statements are often identified by
terms such as "may", "should", "anticipate", "expect", "potential",
"believe", "intend" or the negative of these terms and similar
expressions. Forward-looking statements in this news release
include statements relating to: High Tide completing the
Transaction on the terms and within the timelines set out in this
news release; High Tide receiving requisite approvals for the
Transaction; the anticipated effects of the Transaction on the
business and operations of High Tide; Mr. Grover's expectation to
announce more retail acquisitions in the future; Mr. Grover's
statement with respect to High Tide's goal of reaching 150 stores
by the end of calendar 2022; and High Tide's plans to extend and
strengthen its integrated value chain, while providing a complete
customer experience and maximizing shareholder value.
Forward-looking information in this news release are based on
certain assumptions and expected future events, namely: that High
Tide will have the ability to successfully complete the Transaction
(and will have the ability to obtain all requisite approvals) on
the terms and within the timelines anticipated by High Tide; High
Tide's financial condition and development plans do not change as a
result of unforeseen events; there will continue to be a demand,
and market opportunity, for High Tide's product offerings; current
and future economic conditions will neither affect the business and
operations of High Tide nor High Tide's ability to capitalize on
anticipated business opportunities), although considered reasonable
by management of High Tide at the time of preparation, may prove to
be imprecise and result in actual results differing materially from
those anticipated, and as such, undue reliance should not be placed
on forward-looking statements.
These statements involve known and unknown risks,
uncertainties and other factors, which may cause actual results,
performance or achievements to differ materially from those
expressed or implied by such statements, including but not limited
to: the risks associated with the cannabis and CBD industries in
general; the inability of High Tide to close the Transaction; the
inability of High Tide to obtain requisite approvals, the inability
of High Tide to pursue more retail acquisitions in the future, the
inability of High Tide to acquire more stores and to reach 150
stores by the end of calendar 2022, the inability of High Tide to
extend and strengthen its integrated value chain, while providing a
complete customer experience and maximizing shareholder
value.
Forward-looking statements, forward-looking financial
information and other metrics presented herein are not intended as
guidance or projections for the periods referenced herein or any
future periods, and in particular, past performance is not an
indicator of future results and the results of High Tide in this
press release may not be indicative of, and are not an estimate,
forecast or projection of High Tide future results. Forward-looking
statements contained in this news release are expressly qualified
by this cautionary statement and reflect our expectations as of the
date hereof, and thus are subject to change thereafter. High Tide
disclaims any intention or obligation to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise, except as required by law. Factors that
could cause anticipated opportunities and actual results to differ
materially include, but are not limited to, matters referred to
above and elsewhere in High Tide's public filings and material
change reports, which are and will be available on SEDAR.
This news release does not constitute an offer to sell or
a solicitation of an offer to buy any of the securities in
the United States of America. The
securities have not been and will not be registered under the
United States Securities Act of 1933 (the "1933 Act") or any state
securities laws and may not be offered or sold within the United States or to U.S. Persons (as
defined in the 1933 Act) unless registered under the 1933 Act and
applicable state securities laws, or an exemption from such
registration is available.
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SOURCE High Tide Inc.