Alcanna Inc. and YSS Corp. announced that, as a result of excess demand, the previously announced $25.0 million equity financing being led by Eight Capital and Cormark Securities Inc. has been upsized to $40.0 million. The Financing will be completed in connection with a transaction pursuant to which Alcanna will spin-out its retail cannabis business and combine with YSS to form “Nova Cannabis Inc.”, a new discount-focused cannabis retailer. In all other respects, the terms of the Transaction and the Financing will remain as previously disclosed in the January 18, 2021, press release other than the Agents’ option to offer for sale up to an additional 25% of the subscription receipts has been relinquished.
Closing of the Financing is expected to occur on or about February 5, 2021. The completion of the Financing is subject to customary closing conditions and regulatory approvals, including of the TSX Venture Exchange (the “TSXV”).
Following the closing of the Transaction and assuming completion of the Financing for $40.0 million, it is anticipated that Alcanna will hold approximately 63%, current YSS shareholders will hold approximately 13% and new subscribers under the Financing will hold approximately 24% of the shares of New Nova, respectively, calculated on a basic basis.
Alcanna is one of the largest private sector retailers of alcohol and cannabis in North America and the largest in Canada by number of stores – operating 238 locations in Alberta and British Columbia. Additional information about Alcanna is available at www.sedar.com and www.alcanna.com.
With retail operations under the YSS™ and Sweet Tree™ brands, YSS Corp. has developed a retail cannabis business across Alberta and in Saskatchewan by operating 19 licensed retail stores in Alberta and Saskatchewan. It has 5 stores in development for 2021. Additional information about YSS is available at www.sedar.com and www.ysscorp.ca.