High Tide Inc. (NASDAQ:HITI) (TSXV:HITI) (FSE: 2LYA) has completed its acquisition of three operating cannabis stores in Ontario operating under the name Crossroads Cannabis, for CA$1.9 million ($1.48 million). The stores are located in Stratford, Hanover, and Markdale. The Stratford store is located in a retail plaza anchored by a national discount grocery chain. The Hanover store is located in a power centre with numerous anchors including national grocery and big box retail chains. The Markdale store is well-located immediately beside the provincial liquor retailer. For the three months ended December 31, 2021, the three Crossroads locations generated annualized revenue of CA$6.0 million and annualized adjusted EBITDA of CA$0.6 Million.
The company intends to complete the acquisition of the fourth Crossroads store in Woodstock, Ontario, per its press release dated March 3, 2022, pending regulatory approvals. Once completed, the total purchase price for all four stores in the transaction will represent 3.5x annualized Adjusted EBITDA for the three months ended December 31, 2021.
The acquisition was completed pursuant to the terms of an asset purchase agreement. High Tide acquired the stores for common shares of High Tide valued at CA$1.9 million, on the basis of a deemed price of CA$5.0313 per High Tide share, being equal to the volume weighted average price per High Tide share on the TSX Venture Exchange for the 10 consecutive trading days preceding closing of the acquisition. The closing of the transaction remains subject to final approval from the TSXV.
Photo: Courtesy of CNW Group/High Tide Inc.
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