CALGARY, Alberta, March 20, 2019 (GLOBE NEWSWIRE) -- Solo Growth Corp.™ (the “Company” or “Solo Growth”) (TSXV: SOLO) is pleased to announce that it has entered into and closed a definitive agreement, effective March 20, 2019, with respect to a call right on all of the voting shares of a licensed operating retail cannabis store in Red Deer, Alberta for aggregate cash consideration of $2.6 million (the “Call Right”).  Concurrent with the acquisition of the Call Right, the Company entered into a perpetual licensing agreement to rebrand and operate the store under the YSSTM banner (together with the Call Right, the “Acquisition”).

Acquisition Highlights

  • Opened November 22, 2018, the location has an established market presence with a growing customer base;
  • One of two currently licensed legal cannabis retailers in Red Deer, operating as “Green Town”;
  • Aggregate revenue from opening to February 28, 2019 of $1.3 million;
  • Store level adjusted cash flow of approximately $335,000 in the first 98 calendar days since opening; and
  • Located near downtown Red Deer with 15 dedicated parking stalls, near a major shopping centre.

The Acquisition will establish the first operating YSSTM branded store in Canada and provides the Company with immediate revenue equal to the cash flow generated at the retail location.

“The Acquisition aligns well with our corporate strategy to complement our robust organic growth profile with strategic opportunities that drive near and long-term shareholder value”, said Theo Zunich, President and CEO. “We look forward to inviting customers to our first branded store, YSS Red Deer, in the near future”.

All required regulatory approvals, including from Alberta, Gaming, Liquor & Cannabis (“AGLC”), have been obtained and the Acquisition closed today.  The Company may exercise the Call Right in its sole and absolute discretion at any point in time for nil consideration.  Eight Capital acted as strategic advisor to the Company in connection with the Acquisition.

Additional Information

For additional information regarding Solo Growth please see the corporate website at www.sologrowth.ca and filings available under the Company’s profile on SEDAR at www.sedar.com.

About Solo Growth Corp.TM

Operating as YSSTM, the Company is a cannabis retailer with the vision to become a premier retailer and the trusted destination for cannabis in Canada.  Since its launch in June of 2018, the Company has built a strategic portfolio of locations while managing financial commitments.  The Company has a licensing agreement and Call Right on one operating store in Red Deer, Alberta, has built and received AGLC inspections on five additional Alberta stores, and has a further two Alberta locations nearing completion of construction.  An additional 16 AGLC applications are being reviewed for construction priority within the current regulatory environment.  YSSTM management brings excellence across capital markets, financial management and a strong commitment to deliver shareholder value by leveraging high-quality opportunities within this exciting new industry.  The YSSTM retail experience is built on our five fundamental pillars: convenience, value, selection, team, and above all else, trust.

Investor or Media Contacts: 

Theo Zunich
President, Chief Executive Officer
and Director
Phone: (403) 455-7656  

Solo Growth Corp.™
Suite 1000, 350-7th Ave SW
Calgary, AB T2P 3N9
investor@sologrowth.ca 

OR

Cindy Gray
5 Quarters Investor Relations, Inc.
(403) 231-4372 or info@5qir.com 
Stephanie Bunch, CA
Vice President, Finance and
Chief Financial Officer
Phone: (403) 455-7656

Forward-Looking and Cautionary Statements

This news release may include forward-looking statements including opinions, assumptions, estimates, the Company’s assessment of future plans and operations, and, more particularly, statements concerning: Solo Growth’s retail cannabis business strategy, including organic growth and strategic activities; the Red Deer Transaction, including the licensing agreement, the Call Right and market presence and customer base in respect of the retail location; the ability to build, own and operate retail cannabis stores; the receipt of necessary permits and licenses to open stores; the ability to capitalize on potential opportunities that may arise and the ability to exercise thereon; and enhancing value for shareholders. When used in this document, the words “will,” “anticipate,” “believe,” “estimate,” “expect,” “intent,” “may,” “project,” “should,” and similar expressions are intended to be among the statements that identify forward-looking statements. The forward-looking statements are founded on the basis of expectations and assumptions made by the Company. Forward-looking statements are subject to a wide range of risks and uncertainties and, although the Company believes that the expectations represented by such forward-looking statements are reasonable, there can be no assurance that such expectations will be realized. Any number of important factors could cause actual results to differ materially from those in the forward-looking statements including, but not limited to: regulatory and third party approvals not being obtained in the manner or timing anticipated, including AGLC inspections and licenses; the ability to implement corporate strategies; the state of domestic capital markets; the ability to obtain financing; changes in general market conditions; industry conditions and events; the size of the recreational cannabis market; changing customer habits; the availability of cannabis-retail products from licensed producers; government regulations, including future legislative and regulatory developments involving recreational cannabis; competition from other industry participants; and other factors more fully described from time to time in the reports and filings made by the Company with securities regulatory authorities. Please refer to the Company’s annual information form (“AIF”) for the financial year ended January 31, 2018 and management’s discussion and analysis (“MD&A”) for the three and nine months ended October 31, 2018 for additional risk factors relating to the Company. The AIF and MD&A can be accessed under the Company’s profile on www.sedar.com.

Except as required by applicable laws, the Company does not undertake any obligation to publicly update or revise any forward-looking statements.

This news release contains future-oriented financial information and financial outlook information (collectively, “FOFI”) about revenue and store level adjusted cash flow in respect of the Red Deer location, which are subject to the same assumptions, risk factors, limitations, and qualifications as set forth in the above paragraphs. FOFI contained in this document was made as of the date of this document and was provided for the purpose of providing further information about Solo Growth’s future business operations. Solo Growth disclaims any intention or obligation to update or revise any FOFI contained in this document, whether as a result of new information, future events or otherwise, unless required pursuant to applicable law. Readers are cautioned that the FOFI contained in this document should not be used for purposes other than for which it is disclosed herein.

Store level adjusted cash flow is not prescribed by International Financial Reporting Standards (“IFRS”). The Company uses this measure to help evaluate the financial and operating performance of the Red Deer location. This non-IFRS financial measure does not have any standardized meaning prescribed by IFRS and therefore may not be comparable to similar measures presented by other issuers. “Store level adjusted cash flow” is calculated as gross margin less expected continuing expenses of the business such as rent, wages, utilities, IT related charges, repairs & maintenance, bank charges, store supplies and general office expenses, but before interest, depreciation, amortization or taxes.

Neither the TSXV nor its regulation services provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release.