Canadian cannabis and alcohol company SNDL has acquired a minority stake in competitor High Tide, which operates the largest retail chain in the country.
According to a U.S. Securities and Exchange Commission filing, SNDL acquired 4,350,000 shares of High Tide, or roughly 5.4%.
Both companies are headquartered in Calgary, Alberta.
Investors that acquire a 5% ownership stake or more in publicly traded companies are typically required to disclose those transactions and ownership percentage in regulatory filings.
High Tide subsidiary Canna Cabana is the largest retail operator in Canada with 194 stores, according to StratCann, which first reported SNDL’s move.
In a recent earnings call, High Tide CEO Raj Grover said the investment highlights how the company’s shares are “significantly undervalued,” according to Green Market Report.
High Tide reported record revenue in the first quarter of 142.5 million Canadian dollars ($99.7 million), up 11% year-over-year.
The company posted a net loss of $2.7 million for the quarter that ended in January; High Tide broke even in the same period a year ago.
High Tide said in February it was reevaluating its cash-and-stock deal to acquire a 51% stake in Purecan GmbH to enter Germany’s growing medical marijuana market.
SNDL shares trade as SNDL on the Nasdaq exchange.
Shares of High Tide trade as HITI on the Nasdaq and TSX Venture Exchange.
