Simply Solventless Concentrates Ltd. has entered into an agreement to buy cannabis producer ANC Inc. for $10 million in cash and shares.
In an announcement on September 25, Simply Solventless Concentrates (SSC) says the acquisition will complement SSC’s portfolio, especially ANC’s track record with pre-roll manufacturing.
The purchase price includes $7 million in cash paid out in three instalments through May 31, 2025, along with $3 million in shares of SCC at $0.50 per unit.
“We are thrilled to announce the foundational acquisition of ANC, continuing our strategy of profitable organic revenue growth and opportunistic acquisitions,” says SSC’s President & CEO Jeff Swainson. “ANC holds significant intellectual property, some of which is patented, and they have garnered industry-wide respect for their execution ability. Together with ANC’s incredible team, led by Clayton Bordeniuk, Tairance Rutter, Thomas Facciolo and James Clarke, we will leverage SSC’s strategic positioning, our complimentary core competencies, and our proforma profitability to capture continued opportunity and value for our shareholders.”
Following several positive quarters, SCC has been on a bit of a purchasing spree. On June 25, 2024, the Alberta-based company behind cannabis brands like Astrolab, Frootyhooty, Roilty, and Zest entered into a services agreement and share purchase agreement with CannMart Inc., a cannabis company located in Etobicoke, Ontario for $2.5 million. SCC also recently acquired Lamplighter in January 2024.
As of June 30, 2024, the Company had a working capital surplus of $5,909,655, compared to $4,263,711 as of March 31, 2024.
ANC was first licensed as a micro cultivator in 2019 and later received its micro processing licence. The company then scaled up to a standard licence, with a focus on seed production and pre-roll manufacturing, something they have become well-known for in the industry. The acquisition will give SCC the ability to manufacture pre-rolls in-house, giving the parent company a new avenue for its own products to reach consumers.
Clayton Bordeniuk, President & CEO of ANC, stated in a press release: “ANC Solutions is a leader in infused pre-roll manufacturing in Canada, and we are excited to integrate into the SSC family. This partnership allows us to leverage our operational expertise and SSC’s broad network to drive continued innovation; and together, we will expand product offerings and enhance operational efficiencies while continuing to deliver premium cannabis products and services to the market. This deal marks a pivotal moment for ANC, as SSC is the growth partner that we had been looking for. It is our belief that our combined team, coupled with our shared focus on profitability and operational excellence, creates a platform for explosive growth and strong results as we move forward together.”
ANC is currently generating around $15 million of annualized revenue and $3.6 million of annualized net income. As this is B2B and tolling revenue, it is also not subject to excise taxes, something SCC says will its overall corporate blended excise tax rate.
Featured image via ANC Solutions.
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