Calgary, Alberta-based cannabis producer Sundial Growers said it has reached a deal to buy Alcanna, Canada’s largest private liquor retailer, for 346 million Canadian dollars ($277 million) in stock.

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Edmonton-headquartered Alcanna operates 171 liquor stores, mostly in Alberta.

In a news release, Sundial said the expansion into the liquor business will provide the company “with stable cash generation through a mature and proven business model.”

Alcanna is also the largest shareholder of Nova Cannabis with an approximately 63% stake in the cannabis retailer.

Nova operated 55 cannabis stores as of June 30, 2021, with 50 in Alberta, four in Ontario and one in Saskatchewan.

Earlier this year, Sundial bought Inner Spirit Holdings, another cannabis retailer, for approximately CA$131 million.

Once the deal with Alcanna closes, Sundial said it will have 170 cannabis stores in six Canadian provinces.

In its most recently completed quarter, Alcanna’s liquor sales were CA$159.3 million, or 84.3% of overall revenue.

Nova’s cannabis sales were CA$29.7 million in its previous quarter, about 15.7% of Alcanna’s sales.

“Alcanna’s value-focused model in liquor retailing has created market stability and we believe that the replication of this playbook in cannabis has strong potential to drive a similar result,” Sundial CEO Zach George said in a news release.

“We intend to position all of our retail exposure for profitability and strive to work with Canadian licensed producers in order to delight consumers with quality cannabis products.”

The deal is subject to approval by Alcanna’s shareholders.

Sundial’s shares are traded on the Nasdaq under the symbol SNDL.