MTY Food Group Inc. (TSX:MTY) entered into an agreement to acquire Kahala Corp. (OTCPK:KAHL) from Delavaco Group, Serruya Private Equity, and others for approximately $300 million in cash and stock on May 25, 2016. Under the terms of the transaction agreement, the consideration payable for the shares of Kahala was $240 million in cash plus 2.25 shares of the Company. On closing, $30 million was held back to cover various contingencies described in the transaction agreement; the amount is to be repaid over a three-year period. The cash component was sourced from the Company's cash on hand and from a new $435.93 million credit facility. TD Securities will act as the sole Lead Arranger and Bookrunner for a syndicate of lenders. As of June 20, 2016, the transaction received early termination from HSR. As of July 21, 2016, deal has been approved by the shareholders of Kahala.

Kahala's head office is located is Scottsdale, Arizona. Following the transaction, MTY's US head office will be moved into Kahala's current offices. The agreement remains subject to multiple conditions, including standard regulatory approvals (including TSX approval), financing and other conditions customary for a transaction of this nature. The closing of the transaction is expected to happen within the next 75 days. The transaction is expected to be immediately accretive. North Point Advisors acted as financial advisor to Serruya Private Equity. Curtis Cusinato, Mike Devereux and Evan Marcus of Stikeman Elliott LLP acted as legal advisors to Kahala Corp. All the conversions made using oanda.com as of November 11, 2016.

MTY Food Group Inc. (TSX:MTY) completed the acquisition of Kahala Corp. (OTCPK:KAHL) from Delavaco Group, Serruya Private Equity, and others on July 26, 2016.