TORONTO, Canada — Fire & Flower Holdings Corp. is entering the U.S. cannabis market.
Under terms of an agreement with the Canadian-based American Acres Managers, the cannabis retailer will license its Fire & Flower brand, store operating system, and its Hifyre technology platform for dispensaries in California, Arizona and Nevada.
Fire & Flower anticipates the first branded store to open in Palm Springs, Calif., during the first half of its fiscal 2021 year.
According to a press release from Fire & Flower, highlights of the strategic agreement with American Acres Managers include:
- The opportunity to successfully export its operational model into the United States;
- The opportunity for the Fire & Flower brand and technology to enter into other U.S. cannabis markets;
- A discounted path to corporate-owned stores in major U.S. markets;
- Licensing of the Fire & Flower brand, store operating system and Hifyre technology platform to American Acres on a royalty-free basis;
- The opportunity to leverage Fire & Flower's proven technology to drive greater profitability in existing U.S. retail stores and set the stage for acquisitive growth strategy when legal; and
- The proposed strategic entry into California aligns with Fire & Flower's optimal operating model which includes direct relationships with product producers, private retail, e-commerce and delivery.
"Since becoming Canada's largest retail network for legal cannabis products and services, we have strongly positioned our brand, operating system and technology to successfully enter key international markets where we believe our platform would be strongly valued," said Fire & Flower CEO Trevor Fencott.
"Due to the rapid success of our operational model in Canada, the Fire & Flower brand is poised to become a key player in the U.S. cannabis industry, where the demand for incorporating technologically advanced systems in cannabis retail has never been greater," he added. "Our Hifyre technology has surpassed our competitors' offerings by streamlining the customer experience and driving greater margins and places the Fire & Flower brand in a unique position to play a leading role in competitive U.S. cannabis markets."
Additionally, the agreement provides Fire & Flower with a discounted path to corporate-owned cannabis retail stores in major U.S. markets. Under terms of the deal, in recognition of the value of the Fire & Flower license, the retailer will have the option to acquire American Acres at a discount price to fair market value. The acquisition is expected to occur upon the federal legalization of adult-use cannabis in the United States, or when otherwise permitted by the policies of the Toronto Stock Exchange or any other stock exchange on which the company’s securities are listed for trading.
Toronto-based Fire & Flower Holdings Corp. owns all issued and outstanding shares in Fire & Flower Inc. and Friendly Stranger Holdings Corp., licensed cannabis retailers that own and operate cannabis retail stores in the provinces of Alberta, Saskatchewan, Manitoba and Ontario, and the Yukon territory.
Fire & Flower is a multi-banner cannabis retail operator that owns and operates the Fire & Flower, Friendly Stranger, Happy Dayz and Hotbox brands.
Laval, Quebec-based Alimentation Couche-Tard Inc. officially entered the cannabis retailing sector with the closing of its investment in Fire & Flower Holdings Corp. in 2019.