Adult-use cannabis retailer Fire & Flower Holdings entered into a definitive agreement to buy rival store operator Friendly Stranger Holdings.
Under the deal, if it’s approved, Toronto-based Fire & Flower would issue approximately 31.1 million shares to Friendly Stranger shareholders, valuing the proposed transaction at about 24.6 million Canadian dollars ($18.1 million).
Fire & Flower said that after the deal closes, it expects to have 66 stores, including 18 in Ontario and an additional nine in queue for licensing.
“The acquisition of Friendly Stranger is transformative for Fire & Flower and is a product of our financially disciplined approach to aggregation in the sector,” CEO Trevor Fencott said in a news release.
Fire & Flower also said it plans to loan Friendly Stranger up to CA$2 million.
The acquisition is expected to close in the fourth quarter of this fiscal year.
Shares of Fire & Flower trade on the Toronto Stock Exchange as FAF.