Negotiations between Chemist Warehouse and Astrid Dispensary have ground to a halt, according to sources familiar with the matter.
The pharmacy giant emerged as the surprise frontrunner to snap up the business in October, with the two parties said to be closing in on terms.
Since then, however, a number of sticking points have surfaced — among them, how long Chemist Warehouse expects Astrid founder Lisa Nguyen to stay on after any deal is completed.
Nguyen has been the public face and driving force behind Astrid since opening its doors in 2021.
Given her central role at the dispensary, Chemist Warehouse is understood to want Nguyen to remain at the helm for a number of years, a commitment she is reportedly unwilling to make.
Sources believe the acquisition could still proceed, but stressed that several key terms have yet to be resolved.
As competition across the medicinal cannabis sector continues to intensify, Chemist Warehouse is also said to have grown uneasy about what appears to be a decline in revenue at Astrid — a pattern affecting multiple companies as product prices keep falling.
"Astrid is a great business and a great brand but medicinal cannabis is a tough place to be at the moment," one commentator said. "There is also the threat of the TGA consultation hanging over the industry which may be spooking investors."
Nguyen was contacted for comment.
She said last month that the business "was not in a position to provide further comment" about the interest of Chemist Warehouse.
"We remain focused on supporting our patients, people, and partners," she said at the time. "We will share any updates through the appropriate channels when the time is right."
Update 11.30am: Responding to questions about the deal and whether her earn out duration was a sticking point, Nguyen, who is currently on an overseas break, said in a text that the "information is incorrect". She did not provide further comment.