Adam JacksonFebruary 7, 2023
SNDL plans to maintain the Superette banner.
Superette Archives - Green Market Report
Adam JacksonFebruary 7, 2023Adam JacksonDecember 21, 2022
SNDL (Nasdaq: SNDL) and Nova Cannabis (OTCQB: NVACF) have fashioned new terms for their existing relationship as the two look to grab more market share in a consolidating Canada.
In a statement, SNDL said that the new arrangement would create a “well-capitalized cannabis retail platform in Canada under a vertical integration model with SNDL’s upstream capabilities.”
“With this strategic partnership, Nova will be well positioned to thrive and focus on growth and profitability in the coming years through this world-class cannabis retail platform,” said SNDL CEO Zach George. “SNDL will continue to support and sponsor Nova in a compliant manner while leveraging our capital base and retail M&A pipeline to improve Nova’s trading liquidity and future growth.”
When the deal’s sown up, Nova will receive retail contribution and corporate service from SNDL, as well as debt restructuring that includes a C$15 million revolving credit facility that SNDL will wipe.
The injection, which is expected to be fully drawn at the time of the closing of the transaction, will immediately provide Nova with additional liquidity to the tune of C$5.5 million.
The deal also provides for a return of equity, with around 14.3 million shares of Nova held by SNDL’s holdings scheduled to be returned to Nova’s treasury for cancellation.
SNDL said it plans to reduce its equity ownership in Nova to below 20% through a capital distribution of Nova Shares owned by SNDL to its shareholders, increasing liquidity.
Additionally, SNDL will receive intellectual property rights as consideration to Nova’s fast-growing Value Buds banner of 88 stores and the license to grant Nova to operate the Value Buds, Spiritleaf and Superette banners.
The two became tethered when SNDL in March spent C$320 million to snap up Nova’s majority shareholder, Alcanna. Then-Nova CEO touted SNDL’s ability to provide infrastructure and financial resources to its value-based model to drive scale and expansion.
The company said it partnered with SNDL for Value Buds’ private label strategy with goals to remain aggressive with its pricing strategy for the two’s white label venture in order to capture further market share in Canada.
In last month’s earnings release, Nova stated that it wants to “disrupt and strengthen the cannabis retail market by promoting a wide range of cannabis products at everyday best-value prices, while encouraging greater migration from the illicit cannabis market.”
Nova said its starting to raise pricing across all categories in Alberta to test elasticity and understand consumer buying trends and expects higher margin results in the fourth quarter. It also expects to add three more stores in Alberta and Ontario in the remainder of this year and early next.
Anne Fitzgerald, lead independent director of Nova, said that the deal “provides Nova with a unique opportunity to further transform the cannabis retail market in Canada and enhance its business in a material way to the benefit of all our shareholders.”
“A special committee of independent directors of Nova has completed an extensive due diligence process including the advice of independent financial advisors and has concluded that the transaction is fair from a financial point of view to Nova shareholders. The support of SNDL, both operationally and financially, allows Nova to remain laser-focused on growth and profitability.”
StaffMarch 26, 2022Superette
Mimi Lam, Co-Founder Superette
1) What is your proudest accomplishment in the cannabis industry?
I’m super proud of taking a risk on myself and starting Superette. The journey of going from an idea in our heads to building a living and breathing tangible brand is incredibly validating. And we haven’t made it easy for ourselves! Not only is our business operationally complex and highly regulated, but we have also carved our own path, rejecting the status quo of cannabis retail and cannabis brands. Seeing the brand resonate with our customers around the world makes it all worth it. And because of Superette, I have been able to truly work with the best in the business – from the budtenders that represent the backbone of our business to everyone I am so lucky to collaborate with at head office. A company is nothing without its people. Even more so than Superette as a brand, I am proud of Superette as a team.
2) Do you feel that the cannabis industry has more opportunities for female-identifying people than other industries?
I don’t think the cannabis industry necessarily has more female-identifying opportunities, so much as females are in a position to identify and approach opportunities that are being overlooked. In the early days of legal cannabis in Canada, there was a lot of hope for female and minority representation, relative to other industries. However, I think the reality has been different especially when it comes to specific roles and in leadership positions. I believe in creating the future we want to live in, so I am optimistic and will continue to fight for representation and for creating opportunities for female-identifying people and minority groups.
3) Do you feel you have to work twice as hard as male colleagues or do you think the industry has moved past that?
It’s not something that can be quantified. Sometimes things feel smooth sailing and sometimes it feels like I must work 10x harder to even get noticed. It really depends on the environment you are in and who you are talking to. Subconscious bias is still incredibly prevalent, with womxn being overlooked and disregarded more often than men. I have worked hard to prove myself and my worth and to build my reputation, but still there are conversations where I am ignored or overlooked, or simply left out of the conversation. Unfortunately, I know I am not alone in that.
4) What was your biggest challenge in business and how did you overcome it?
Cliché, but surviving and growing a business during a pandemic. For two years, there were constant changes to public health recommendations and regulations regarding how we could operate or not, supply chain issues etc. We were tested in ways no business plan could have contemplated. Every day felt uncertain and sometimes hopeless. My personal challenge was feeling a big disconnect between the external excitement about our brand and our continued innovation vs. the realities of simply surviving and being able to keep the doors open. It was not business as usual, and my role in leading our team and the brand with hope, despite what was going on, took a huge emotional toll on me. What really helped me during this time was our people. Those around me believed in the vision and believed in our path just as strongly as I did, and together we made it through.
5) What have you or your company done to help give more opportunities for women? Roughly half of our team identify as women and I’m really proud of that. For us, it begins with representation and creating a safe space for all demographics. From the language we use when hiring and onboarding, to day-to-day collaboration, we are very conscious of how we show up. Across the board, we maintain very open lines of communication for feedback, and we have constant check-ins on all team members to ensure that they feel supported, and to learn about areas we can improve as a business. We fundamentally believe in our people and in listening to our people and over the years, we have seen a lot of internal growth and movement across teams and locations.
6) What are your personal goals for 2022?
Yikes, this is the most difficult question. Along the lines of self-care and finally making time to prioritize me, some things I want to (finally) get to are finding a doctor and reading at least a book a month. I also want to master the art of making croissants!
StaffFebruary 22, 2022
Today Superette Inc. said it was buying Cannoe Corp. secured $5 million in financing. Cannoe has six stores that will give Superette exposure to new areas and key brand-driven markets including highly frequented cottage and resort towns. Superette said in a statement that the acquisition of Cannoe brings immediate and meaningful scale to its retail operations, doubling its footprint to twelve operating stores, with four locations to be finalized in 2022.
The acquisition, financing, and combination of teams provide the resources and operational excellence required to build a durable business and enter new markets. Founded in 2018, Cannoe quickly attracted the attention of industry veterans, like the founders of Roots, who were early investors along with Stephen Arbib co-founder of MedReleaf.
“Since our launch, Superette has stood out as the retail brand that reflects the attitudes a huge portion of recreational customers have – simply put, we exist to make buying cannabis fun. With an ambitious aesthetic and unforgettable retail experiences, Superette is our interpretation of the intersection of cannabis, lifestyle, and community,” said Mimi Lam, Co-Founder of Superette.
In connection with the transaction, Superette said it was able to secure $5 million in financing to support strategic growth opportunities, both organic and inorganic. As part of the transaction, Superette is adding significant corporate resources to its executive team and board of directors. Cannoe’s President Matt McLeod is joining Superette as CEO. Matt is an experienced executive with extensive corporate and cannabis experience.
“I’m super excited to be joining Superette as CEO. Cannabis retail in Canada is a rapidly growing and maturing market, and I feel really fortunate for the chance to work with co-founders Drummond Munro and Mimi Lam. I’m thrilled to have the opportunity to combine the complementary abilities of the Cannoe and Superette teams and strongly believe that we have a team ready to capitalize on the opportunities ahead of us. This financing and transaction positions us for continued outperformance on service, product excellence and growth. Superette offers a truly unique retail experience, and we will continue to leverage the brand, vision and service, but we have a lot to learn from those who have shaped the industry from the legacy market to today and made a company like ours possible. I’m looking forward to getting to work with this talented group,” said Matt McLeod, Chief Executive Officer, Superette
Superette was founded by Drummond Munro and Mimi Lam, with a unique and differentiated approach to cannabis retail. The Company has built an industry-leading following, and its stores are the hallmark of every neighborhood they operate in. By bringing both teams, resources, and operations together, they have created the most robust independent retail platform in Ontario.
Since legalization in 2018, the legal cannabis retail market in Ontario has grown by $2.3 billion, at a compound annual growth rate of 131%, with the last quarter of 2021 estimated to be $450mm. In this rapidly growing and challenging market, Superette has been able to rise above, time and time again. Often positioned alongside some of the most iconic fashion retail names in the world for its striking store design and brand aesthetic, Superette stands out among its competitors in the highly saturated cannabis retail market. The award-winning brand has secured the attention of consumers and the media alike, growing its audience by 119% and boasting hundreds of millions of top tier media impressions last year, with a Net Promoter Score of 95 which outperforms both cannabis and traditional non-cannabis retailers.
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