London Inc. Weekly

Weekly Regional Business Intelligence

Written by Kieran Delamont, Associate Editor, London Inc.

SNDL announces successful bid to acquire London’s Indiva Limited

Calgary-based cannabis company SNDL announced that its stalking horse bid to buy Indiva’s assets out of creditor protection has been successful. “We are thrilled by the opportunity to partner with our colleagues at Indiva to deliver high-quality products and brands to consumers,” said SNDL’s CEO Zach George. “This transaction will materially improve our market share in the edibles category and is expected to unlock value through improved capacity utilization, a reduction in aggregate corporate expenses, and the potential sale of redundant real estate holdings.” No price has been officially announced for the deal, but back in July when the bid was first announced, the price was estimated at between $25 million and $28 million. The deal is subject to approval by the Ontario Superior Court of Justice.

The upshot: If there’s consolidation happening in the Canadian cannabis market, there’s a good chance these days that SNDL is involved. In July, just before the Indiva deal was first announced, it also bought the debt of Manitoba-based Delta9, and has grown its expansive retail network largely through acquiring distressed brands such as Superette and Nova Cannabis (SNDL is now the largest cannabis retail company in Canada.) Still, SNDL is not immune from the same pressures as the rest of the cannabis sector: last month, they announced a major restructuring, laid off over 100 full-time workers, and last year recorded a loss of $176.6 million. But Indiva should be a valuable pickup for them ― it has a solid lineup of popular edibles brands. The next thing to look for will be what they opt to do with Indiva’s growing facility on Hargrieve Road in south London.

Read more: StratCann | MJBizDaily

Cami workers approve strike mandate; BrightDrop moves to Chevy banner

Workers at the Cami auto plant in Ingersoll have handed their union a strong strike mandate, with 97 per cent of members voting in favour of strike action, said Unifor Local 88, with bargaining between the union and General Motors set to begin in about a week and a half. The union represents roughly 1,400 workers at the Cami Assembly plant, which produces two models of GM's BrightDrop electric commercial vans. Heading into the negotiations, the big issue for workers is the rotating shifts. “Since the last contract started, for the past three years, we still remain on one shift in the main plant, so a lot of our workers are working two weeks on, two weeks off,” the local’s plant chair, Mike Van Boekel, told CBC News London. “After three years, it’s just been too much. We just need GM and us to come up with some kind of agreement to get everybody back working again.” GM says that it is “committed to working with our Unifor partners to create a new labour contract for Cami employees.”

The upshot: The Cami negotiations follow, by about a year, a much larger round of negotiations between Unifor and Canadian automakers which saw agreements reached without any disruptions. A strike could start as soon as September 17 if the two sides can’t reach a deal. But the tenor between the two sides hasn’t been all that acrimonious, at least not publicly, and it seems likely that the deal will look a lot like the deal that Unifor struck with GM last year. “I think they want the same that we want ― they need sales. Volume’s everybody’s friend,” said Van Boekel. In related news, GM announced on Thursday its BrightDrop 400 and 600 models of commercial van made at Cami will join the Chevrolet franchise. The move, designed to increase sales and accessibility of the electric vans, means the models will now be available at Chevy dealerships.

Three manufacturers purchase industrial park parcels with plans to build new plants

It was a hat-trick day for the city’s manufacturing sector on Tuesday after city council approved the sale of three parcels of industrial park land to three separate medium-sized manufacturers and, along with it, the expectation of more than 200 new jobs. Only one of the three companies was named ― Maple Armor Group Corp., which picked up 14 acres in Innovation Park. The other two weren’t named, but the LEDC said they are in the technology and food processing sectors. “We like to hit home runs, but we will take singles and doubles, too,” said the LEDC’s Kapil Lakhotia in an interview with The London Free Press. “This is diversifying the manufacturing sector.” Harry Yangh, chief operations advisor for Maple Armor, said that London offered the best package. “We liked how London wanted to sell only to manufacturers who wanted to build,” he said. “It makes me optimistic about the future.” Two of the parcels are located at Innovation Park, with the third located at Huron Industrial Park.

The upshot: Fantastic to see three new manufacturers committing to set up shop in town, and good on them for scoring themselves a deal, too. Each of the three companies acquired their parcels of land for around $200,000 per acre, beating out an industrial land price hike that went into effect earlier this month (the city raised the price of land in its industrial parks by about $100,000 an acre to put it more in line with neighbouring communities). Lakhotia noted that he would like to see the inventory of city-owned industrial land upped in the near future to accommodate additional investment, particularly potential suppliers to the VW-backed PowerCo battery plant expected to open in St. Thomas in 2027. “We’re confident we will have land ready for immediate needs, but we have to keep an eye on the future, for sure,” he said.

Read more: London Free Press

Experts sound the alarm on the rapid rise of region’s gig economy

Gig economy jobs are making up almost one in five new jobs in the region, a figure that has workforce development experts concerned. Elgin Middlesex Oxford Workforce Planning and Development Board data shows that 19 per cent of all new jobs in the first half of 2024 were gig positions ― that is, jobs like Doordash or Uber Eats, or contract and project-based jobs. In July, the board’s ‘Gig Job Dashboard’ showed that gig job postings in London increased by 137 per cent, with around 90 per cent of those in the services sector. Stephanie Ross, a labour studies professor at McMaster University, told The London Free Press that the region’s numbers are “very high” and can in part be attributed to challenging economic conditions. “It signals that there’s a lot of instability in the economy and that some [employers] do not want to make long-term commitments to workers,” she said.

The upshot: Recent estimates suggest that Canada now has around 1 million gig workers ―roughly three per cent of all working age Canadians. It’s an arrangement that can shift liability and expenses off the employer, but some economists argue that it’s also contributing to our chronically low productivity numbers, since gig workers across sectors tend to spend a lot of the time between tasks not doing anything except waiting for the next job to come in. “If the almost one million platform workers in Canada actually worked all their days, rather than just half, national productivity would improve noticeably,” writes the Centre for Future Work’s director Jim Stanford, who argues that minimum wages for gig workers would help spur higher productivity. “Their employers will quickly find more efficient ways to match labour with customer demand, which will free hundreds of thousands of people to do something more productive.”

Province kicks in $23 million for downtown sewer upgrades

The province announced that it would be covering about three-quarters of the cost of a major downtown sewer line renewal project at a cost of around $23 million. The money is earmarked to replace 175 metres of sanitary sewers under the Thames, which are set to be replaced next year (the current pipe, which is now about 100 years old, carries wastewater from downtown to the Greenway treatment plant). Premier Doug Ford was on hand for the announcement and said the funding would help support London’s housing growth. “London is one of the hottest cities right now in all of Ontario when it comes to manufacturing jobs,” he said at a press conference. “It’s going to support London’s growing population and the economic growth taking place across the region. It’s so important that we get shovels in the ground in every part of our province.”

The upshot: It’s a timely infusion of cash, in part because the city was already talking about having to delay some proposed development because of a lack of sewer capacity. It won’t necessarily speed that up ― the replacement project is still sticking to its original timeline, though Ashley Rammeloo, the city’s director of wastewater, said the plan now is to further enhance capacity by installing multiple connections under the river. The main effect, financially speaking, will be to take a bit of pressure off the city budget. “This is great for our rate payers, because the provincial funding will offset some of those costs,” she said. City staff estimate that the additional sewer capacity will be able to support more than 17,000 new units in the downtown core alone.

Read more: CBC News London | CTV News London

Labatt sets up resource hub to help convenience stores navigate beer sales

Unless you’ve been living under a rock for the past few months, you might’ve heard that beer and wine are soon coming to convenience stores in Ontario. And Labatt is looking to lend a hand to convenience stores and smooth out the process by setting up a new resource hub that’s meant to offer guidance to stores that are about to start stocking its products. The goal is two-fold: first, to convince retailers to stock beer products, specifically; and second, to offer some tips on how to sell effectively. Among the tips, Labatt is telling convenience stores that data from Quebec shows that beer is the biggest seller, and that stores are better to stock medium-sized cases ― 18 or 20 cans being optimal ― rather than singles.

The upshot: Labatt obviously wants to see convenience stores stocking its products, so it makes sense that they would want to offer resources to make that easy for convenience store owners who might be overwhelmed by the sudden change. Labatt has a lot of data from Quebec, where such corner store beer sales are allowed. They point out that their data shows that four out of every five alcohol trips to convenience stores are for beer, not wine or cocktails. And the company suggests there could be big money in it for sellers, too. Not only do cases of beer have good margins, but people heading to the corner store for beer tend to buy other things too ― according to Labatt, beer grows the average convenience store basket by 47 per cent.