LOUISVILLE — CEA Industries Inc. (Nasdaq: CEAD, CEADW) has signed an agreement to acquire Fat Panda Ltd., a Canadian retailer and manufacturer of nicotine vape products, for $12.6 million.
The company will use cash, CEA Industries common shares, and seller and bank debt to fund the acquisition, which “is designed to have minimal dilution to CEA Industries’ shareholders,” according to a press release.
Fat Panda is central Canada’s largest retailer and manufacturer of e-cigarettes, vape devices and e-liquids, with a market share exceeding 50% in the region. The company operates 33 retail locations, including 29 Fat Panda stores and four Electric Fog vape outlets, in the provinces of Manitoba, Ontario and Saskatchewan.
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Fat Panda also operates an online e-commerce platform and sells its own line of e-liquids manufactured in-house, along with a portfolio of trademarks and intellectual property.
“CEA Industries has long been active in the Canadian market, and we are pleased to take the next step in our evolution with this acquisition of Fat Panda, marking our entrance into the high-demand Canadian vape industry,” Tony McDonald, chairman and CEO of CEA Industries, said in a prepared statement. “Fat Panda’s market leadership in central Canada, supported by its network of 33 stores and a vertically integrated product portfolio, reflects a solidified business with strong fundamentals and a proven track record of double-digit revenue growth, consistent profitability, and positive cash flow.”
CEA Industries plans to support expansion of Fat Panda’s retail and wholesale operations, including acquiring additional store locations and launching de novo stores.
“By combining our expertise and resources with Fat Panda’s established operations, we plan to accelerate its expansion and deepen its presence in the Canadian market to create long-term, sustainable value for our shareholders,” McDonald said.
The company said it will continue to employ current management, as well as production and retail staff. The acquisition is expected to be completed in the first half of 2025.
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