Sundial Growers Reports License Deal With Simply Solventless
Sundial Growers Inc. (NASDAQ:SNDL) ("Sundial" or the "Company"), announced today that it has entered into a licence agreement (the "Agreement") with Simply Solventless Concentrates Ltd. ("SSC") (jointly "the Parties") for the processing and manufacturing of a suite of solventless cannabis concentrates products by Sundial in its Rocky View facility using SSC's intellectual property. The Agreement will enable Sundial to utilize its Rocky View asset, while enhancing its focus on producing premium inhalables.
The new agreement also provides the Company the opportunity to leverage SSC's knowledge and expertise regarding concentrates manufacturing with an expanded line of products.
"As part of our continued cost and process optimization initiatives, we are pleased to enter into a licensing agreement with SSC that includes a non-binding purchase agreement to sell the Rocky View facility," said Andrew Stordeur, President and Chief Operating Officer of Sundial. "We believe that this collaboration with SSC will improve our returns on invested capital and provide consumers with an excellent addition to our portfolio of cannabis products."
"Simply Solventless is thrilled to be working with Sundial to provide a portfolio of pure, potent, terpene-rich solventless concentrates across Canada," added Jeff Swainson, President and Chief Executive Officer of SSC. "From old school hash to live rosin, our premium solventless concentrates are hand crafted to captivate even the most discerning of consumers."
Under the Agreement, SSC will receive a royalty on the sale of products manufactured using the SSC brand and technology. SSC will supply the non-cannabis materials to produce SSC concentrate products, in addition to paying Sundial a monthly administration fee. A minimum of 75% of the cannabis materials required for the processing and manufacturing of SSC products will be cultivated by Sundial unless such inventory is unavailable.
The parties are working diligently to enter into definitive agreements for the sale of the Rocky View asset for $5 million, pending completion of due diligence, final negotiation of definitive agreement terms and Health Canada licensing approval. It is the intention of the Parties to enter into these agreements as soon as practicable.
Sundial expects to scale the distribution of SSC products across the country, with the first SSC products targeted to be in stores in the second quarter of 2021. With SSC's support, Sundial will utilize its craft at scale approach to produce and package the cannabis concentrate products, while leveraging its established sales and distribution infrastructure to get the products to market with speed and scale.
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