Grabbing cannabis in Vancouver? The name of your local dispensary could soon be different.
Several Dutch Love cannabis stores in Vancouver are set to be rebranded after they were sold to a new owner.
This comes as the owner of Dutch Love, Freehouse Collective (aka the Donnelly Group), files for creditor protection amid pandemic-related financial struggles. The company employs 800+ staff and owns more than a dozen bars and restaurants in both Vancouver and Toronto, as well as Bomber Brewing and Dutch Love’s parent company Lightbox Enterprises.
Harrison Stoker, Freehouse’s chief growth officer, said the company initiated Companies’ Creditors Arrangement Act proceedings this week to restructure and come to an agreement with its primary lender, Bank of Montreal. It plans to keep operating its hospitality businesses but has sold several cannabis dispensaries.
Three Dutch Love cannabis locations in Vancouver were named in insolvency documents in March. The sale of the Kitsilano, Robson, and Marpole Dutch Love locations to Calgary-headquartered SNDL Inc. was approved for an unspecified sum.
SNDL operates cannabis dispensaries and alcohol retail locations under several brand names, and in a May 15 update to investors confirmed it purchased four Dutch Love locations. The transaction is expected to close by the end of June, with the fourth location being in Ontario.
Stoker also told Daily Hive that another buyer plans to purchase several other Dutch Love stores as well as the intellectual property associated with the brand. That deal has not yet been ratified by the court.
The intellectual property purchase by another firm means SNDL will be required to rename its Dutch Love stores at some point in the future, Stoker said. SNDL did not reply to Daily Hive’s request for comment, but Stoker said Freehouse understands it intends to keep the three Vancouver stores open.
Financial firm Ernst and Young is overseeing the sale of the cannabis dispensaries. According to sale documents, the three Vancouver dispensaries purchased by SNDL have leases running through 2024 to 2025, and the Ontario location in Parry Sound has a lease that doesn’t expire until 2030.
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Freehouse Collective, the rebranded Donnelly Group, owed more than $20 million to BMO, landlords, and the government. In court filings about its application for creditor protection, it said its businesses were successful before pandemic restrictions gutted revenue. As it reopened, it also faced additional challenges around staff retention as minimum wage increased — and climbing interest rates didn’t make things easier.
While the company is selling its cannabis dispensaries, it hopes this will be a story of survival for its restaurants and bars, and the staff who work there.
“This is very much aimed at being a constructive versus destructive journey,” Stoker told Daily Hive.
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