High Tide is further expanding its brick-and-mortar retail cannabis operations and entering the British Columbia market through an agreement to acquire two operating retail cannabis stores in British Columbia, six operating retail cannabis stores in Alberta, and one operating retail cannabis store in Ontario from Choom for CAD$5.1 million.
For the three months ended April 30, 2022, collectively, the stores generated annualized revenue of CAD$10.2 million and annualized adjusted EBITDA of CAD$1.3 million. The purchase price represents 3.8x annualized adjusted EBITDA for the three months ended April 30, 2022.
The arm's length transaction is subject to receipt of required TSX Venture Exchange approval, court approval, approval from various provincial regulators, and other customary conditions of closing, and is expected to close in the coming weeks. The transaction may close in multiple tranches depending on the speed of provincial regulatory approvals. Following the Closing, High Tide will have at least 43 stores in Ontario, 2 stores in British Columbia, 72 stores in Alberta, and 136 stores nationwide.