High Tide to Acquire Crossroads Cannabis, Adding Four Established Cannabis Retail Stores in Ontario

CALGARY, AB, March 3, 2022 /CNW/ – High Tide Inc. (“High Tide” or the “Company“) (Nasdaq: HITI) (TSXV: HITI) (FSE: 2LYA), a leading retail-focused cannabis company with bricks-and-mortar as well as global e-commerce assets, is pleased to announce that it is taking yet another step to expand its bricks-and-mortar retail cannabis operations, by entering into a definitive agreement (the “Acquisition Agreement“) pursuant to which High Tide will acquire four operating retail cannabis stores in Ontario (the “Stores“) under the name Crossroads Cannabis (“Crossroads“), for CAD$2.5 Million (the “Transaction“). The Stores are located in Stratford, Woodstock, Hanover and Markdale. The Stratford store is located in a retail plaza anchored by a national discount grocery chain. The Woodstock store is located in a shopping centre anchored by a large national home improvement store. The Hanover store is located in a power centre with numerous anchors including national grocery and big box retail chains. The Markdale store is well-located immediately beside the provincial liquor retailer. For the three months ended December 31, 2021, Crossroads generated annualized revenue of CAD$7.6 Million and annualized Adjusted EBITDA¹ of CAD$0.7 Million. The purchase price represents 3.5x annualized Adjusted EBITDA for the three months ended December 31, 2021.

“Since its inception, Crossroads has been a very popular cannabis retail brand in the communities that it serves. The Stratford Crossroads location was the first to open in the city and has meaningful levels of goodwill from early customers in the community.” said Raj Grover, President and Chief Executive Officer of High Tide. “As consolidation in the Canadian retail cannabis space has picked up steam, we have become the acquirer of choice. This has allowed us to be strategic in determining where to expand within Ontario, bringing our innovative discount club model to communities which we have not yet been able to serve directly. The pandemic has resulted in longer lead times to open stores organically, and by consolidating the retail landscape through accretive acquisitions, we are keeping up the momentum of overall store expansion. We expect to announce more retail store acquisitions in the near term as we move towards our goal of reaching 150 stores by the end of calendar 2022. I would like to give a warm welcome to the Crossroads team as they join the High Tide family,” added Mr. Grover.

“As I observed how the retail market has matured in Ontario, it became crystal clear to me that consolidation would be the path to true longevity. I recognized the exceptional foresight and leadership in Raj and his committed team, and I’m delighted to now be associated with High Tide and Canna Cabana’s future growth and success,” said Robert Rowe, Sole Proprietor of Crossroads.

SOURCE High Tide Inc.