Fire & Flower Holdings Corp. (OTCQX: FFLWF) and its wholly-owned subsidiary Hifyre Inc. has purchased certain subsidiaries of Wikileaf Technologies Inc. (CSE: WIKI), an online platform for cannabis enthusiasts and consumers, as part of its innovative new digital strategy focused on enhancing the company’s proprietary data-driven retail platform. It is an all-stock deal valued at $7.5 million. The website, associated domain names, e-mail subscriber database, social media channels, content generation platforms, trademarks and technology stack powering the Wikileaf platform generates significant online cannabis user traffic.
Online Virtual Dispensary
Wikileaf said in a statement that it generates significant user traffic through engaging content and domain name strength that will be boosted through the incorporation of Hifyre’s unique data-driven technology solutions into its existing platform. Hifyre said it will transform the Wikileaf website into a virtual online dispensary for cannabis and accessory products utilizing the same e-commerce proprietary technology platform that powers the Fire & Flower retail network. Accessory products will be fulfilled through Fire & Flower’s agreement with Humble & Fume (CSE: HBML) announced last month.
A key aspect of the new digital strategy, Hifyre will create white-labeled online dispensaries fulfilled initially by the Fire & Flower retail network, that can be expanded to other cannabis dispensaries and delivery channels both in Canada and the U.S. In addition, users of all white-labeled websites will be enrolled into Fire & Flower’s proprietary Spark Perks membership loyalty program, expanding upon its ability to capture a high level of engagement and understanding of cannabis consumer preferences and habits both in Canada and the U.S.
Connor Cruise, Wikileaf Chair and Interim CEO said, “We firmly believe this transaction is in the best interest of Wikileaf shareholders. The combination of Wikileaf’s digital assets and Hifyre’s proprietary cannabis digital retail and analytics platform offers the strongest opportunity to realize the value of Wikileaf’s operations to drive continued growth for our online platform. Wikileaf has pursued internally generated as well as the evaluation of merger and acquisition opportunities to monetize the value of the Assets. Through the continued process of internal monetization development of the Assets, it was identified that significantly more financial resources and technical expertise would be required. Wikileaf has actively pursued potential merger and acquisition opportunities to monetize the value of the Assets and determined that the sale of the Assets to Fire & Flower represents the best opportunity to maximize the value of the Assets. Wikileaf intends to retain the Fire & Flower shares for investment purposes at this time and will consider options on what to do with the investment after the transaction is completed.”
“Hifyre’s expanded digital strategy offers a significant opportunity to expand the Company’s e-commerce revenue channels through an asset-light and highly scalable model both in Canada and the U.S.,” shared Trevor Fencott, Chief Executive Officer of Fire & Flower. “The branded online dispensary model is accretive to our retail channel as it offers the opportunity to capture new customers and drive an additional stream of high margin revenue through our Hifyre platform.”
“We believe owning the customer relationship is the most prized part of the value chain and this has been successfully achieved through membership in our Spark Perks program,” shared Matthew Hollingshead, Chief Innovation Officer of Fire & Flower and President of Hifyre. “Our ability to white-label our e-commerce platform offers the opportunity for any brand to create a virtual online cannabis dispensary through our proprietary technology.”