Sundial Growers Inc. (NASDAQ:SNDL) and Simply Solventless Concentrates have announced the signing of a license agreement for the manufacture and processing of a collection of solventless cannabis concentrates. Sundial will leverage SSC’s intellectual property to manufacture the products at its Rocky View facility.
Sundial to produced cannabis concentrates under SSC brand
This agreement will allow Sundial to use its Rocky View Assets, at the same time improve its focus on the production of premium inhalable. Also, the agreement will allow the company to exploit Simply Solventless Concentrates’ expertise and knowledge on cannabis concentrates manufacture with an improved line of products. Under the terms of the agreement, Sundial Growers will pay SSC a royalty in the sale of products produced through its tech and the SSC brand. Notably, SSC will supply Sundial with the non-cannabis materials necessary for the production of SSC concentrates on top of paying a monthly administration fee.
Sundial CEO and President, Andrew Stordeur said that as part of the company’s continued cost and process optimization efforts they have entered a licensing deal with SSC. The agreement includes a non-binding purchase agreement for the sale of the Rocky View asset. Stordeur added that they are optimistic that the collaboration will boost the company’s returns in invested capital and offer consumers a variety of the company’s cannabis products portfolio.
Sundial secures $58.9 Million Investment
Recently, Sundial announced the closing of a special purpose vehicle (Investment) acquisition for $58.9 million in cash. The company funded the acquisition through its available cash reserves of around $110 million before the closing of the investment. The Investment owns an aggregate principal amount of secured debt of $58.9 million of Zenabis Investment Ltd. The debt bears a rate of 14% per year and will mature on March 31, 2025.
According to the terms of the Senior Loan, Sundial will receive a royalty from Zenabis based on quarterly sales revenue for its recreational, wholesale, and medical cannabis sales. Zenabis will pay the royalty for 32 fiscal quarters and will be payable for the quarters it will meet certain revenue targets.