SNDL to buy Valens as cannabis industry M&A activity continues

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MedMen recently lost its opportunity, but acquisitions in the cannabis industry continue to appear

SNDL knows that M&A moves continue to be a reality in the marijuana industry, so it has not wanted to be left behind. The company has now confirmed a deal to acquire The Valens Company, a transaction that will create a leading vertically integrated cannabis platform.

SNDL and Valens met to publicly announce that they have reached a mutual settlement agreement to join forces to create a leading vertically integrated cannabis platform. The terms set forth by the agreement make clear that SNDL will purchase all of the issued and outstanding common stock of Valens, other than those owned by SNDL. Through this legal plan of arrangement, the company will also acquire all of the subsidiaries of Valens.

For each share of Valens, its shareholders will receive 0.3334 of a share of SNDL common stock. Based on last Friday’s close of SNDL stock on the Nasdaq Capital Market exchange, the consideration translates to an implied value of $1.26 per share of Valens for a total consideration of approximately $138 million.

With 185 marijuana stores under the Spiritleaf and Value Buds brands and approximately 555,500 square feet of manufacturing and cultivation, the combined company will offer a never-before-seen portfolio of products to consumers in Canada. To achieve this, it will use its own distribution and supply channels. With no debt and close to $314 million in net cash, SNDL will continue to position itself as one of the strongest balance sheet companies in the North American regulated cannabis industry.