Investment group buys Sundial medical cannabis subsidiary for CA$105 million

A United Kingdom cultivator that is licensed to grow medical marijuana and hemp has been acquired by a group led by a cannabis investment firm.

The U.K.’s Bridge Farm Group, which cultivates ornamental plants, flowers and herbs, announced that it was sold by its parent company, Alberta, Canada-based Sundial Growers, to an entity controlled by representatives of Artemis Growth Partners, an asset management firm based in Costa Rica.

The transaction was worth 105 million Canadian dollars ($75 million), according to a Bridge Farm statement.

As part of the deal, which Sundial confirmed in its own statement, the buyers will assume CA$45 million of debt under the Calgary company’s existing CA$115 million term debt facility,

Sundial has been implicated in a lawsuit by investors who said they were misled into believing that Bridge Farm could “almost immediately” start exporting hemp and CBD products to the European Union.

Bridge Farm, based in Lincolnshire, is licensed to cultivate – but not export – industrial hemp and medical marijuana.

The company’s cultivation-only hemp license was approved in November 2018, and Bridge Farm received one of the U.K.’s 12 research-and-development licenses to grow and extract high-THC cannabis this past January.

To date, Bridge Farm has not sold cannabis of either variety, a company spokeswoman told Hemp Industry Daily.

Sundial said the Bridge Farm sale is subject to:

  • Standard closing conditions.
  • A restructuring of the remaining CA$70 million under Sundial’s debt facility.
  • Sundial’s ability to enter into a new syndicated credit agreement with the company’s senior lenders by June 1.

Sundial trades on the Nasdaq as SNDL.