Sundial Growers (SNDL.Q) entered into a licensing agreement with Simply Solventless Concentrates (SSC) earlier this week according to a press release.
The agreement will have Sundial processing and manufacturing solventless cannabis concentrate products in their Rocky View facility using SSC’s intellectual property to produce inhalable 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. 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,” said Andrew Stordeur, president and chief operating officer of Sundial.
SSC will receive a royalty on any products sales from products using their brand and technology. They will provide the non-cannabis materials to produce SSC concentrate products while paying Sundial a monthly https://e4njohordzs.exactdn.com/wp-content/uploads/2021/10/tnw8sVO3j-2.pngistration fee. Meanwhile, 75% of the cannabis materials needed to process and manufacture SSC’s products will come from Sundial unless the inventory isn’t available.
“Simply Solventless is thrilled to be working with Sundial to provide a portfolio of pure, potent, terpene-rich solventless concentrates across Canada. From old school hash to live rosin, our premium solventless concentrates are hand crafted to captivate even the most discerning of consumers,” said Jeff Swainson, president and chief executive officer of SSC.
Both parties are working on solidifying an agreement to sell the Rocky View facility for $5 million, with only the completion of due diligence, final negotiations of the agreement terms and Health Canada’s approval left to finish.
Sundial intends to scale their distribution of SSC products across the country, with their first set of products expected to be in stores in Q2, 2021. Sundial intends to enlist SSC’s support in using its craft at scale approach to produce and package their cannabis concentrate products while using its established sales and distribution chain to get the products on shelves with attention paid to quantity and speed.