RE:RE:RE:RE:RE:RE:RE:SundialCanuck30 - (1/3/2021 12:56:07 AM)
RE:RE:RE:RE:RE:RE:Sundial It's a shrewd investment by Sundial. They're getting a phenomenal return on their investment and if Zenabis falters on payment, they basically take over operations which includes properties. Not bad IMO for $50 million. Alternatively, to buy out Zenabis, they would have to pay a premium to the current price plus take on the $120 million+ debt. They're basically saving over $40 million if Zenabis falters and Sundial takes everything.
If you have a $1 million house, with a secured loan/mortgage of $600,000., as well as a car loan, boat loan, line of credit, credit card debt - and you default on your mortgage payment - the bank does not take over your house, car, boat, furniture, lawn maintenance, wife and kids, phone and internet bills and anything else used to operate your personal affairs.
The bank only gets the $600,000 secured loan. Most likely you have to sell your house, but if you sell it for the $1 million dollars, the bank gets their $600,000 and you keep the $400,000 and everything else that goes with your personal operation. If the house was also used as collateral for a $10,000 boat loan from another financer - they'd have claim to their money out fo the $400,000 - but it has nothing to do with the $600,000 mortgage.
Some posters seem to think that Sundial taking over $58 million gives them the entire company and operation if Zena defaults - and that's just not logical. Sundial would get it's $58 million secured money back, not the whole kaboodle.
Following that logic, would Sundial have taken over the operation if Zena defaulted on the $7million? No - Sundial would have got the Delta facility used as security. Zena's financing is so convoluted that it's not clear eactly what specific assets are assigned to this particular $58 million debt - but as an example, let's say it's the Stellartion facility (I doubt if it's that straight forward). At the worst, Zena would have to sell that asset (or just let Sundial have it) - but Sundial would only get their $58 million out of whatever it sold for.