Tobacco gi­ant in­vests $2.4B in Cana­dian cannabis pro­ducer

Edmonton Sun - - NEWS -

tobacco gi­ant al­tria Group will in­vest $2.4 bil­lion in cana­dian cannabis pro­ducer cronos group for a 45% own­er­ship stake as the global mar­ket for le­gal pot con­tin­ues to grow.

Vir­ginia-based al­tria, par­ent of the com­pany that makes marl­boro cig­a­rettes, can also in­vest up to a fur­ther $1.4 bil­lion within four years that would in­crease its own­er­ship stake in toronto-based cronos to 55%, un­der the ar­range­ment.

“al­tria brings scale, ex­per­tise and com­pli­men­tary ca­pa­bil­i­ties ... that we be­lieve will en­able us to ex­pand the scope and en­hance the scale of our com­pany,” mike Goren­stein, chair­man, pres­i­dent and chief ex­ec­u­tive of­fi­cer of cronos, said on a call with an­a­lysts Fri­day. as part of the agree­ment, al­tria will have the right to nom­i­nate four di­rec­tors to the cronos board, which will be ex­panded to seven mem­bers from five.

“In­vest­ing in cronos Group as our ex­clu­sive partner in the emerg­ing global cannabis cat­e­gory rep­re­sents an ex­cit­ing new growth op­por­tu­nity for al­tria,” Howard Wil­lard, al­tria’s chair­man and chief ex­ec­u­tive of­fi­cer, said Fri­day in a state­ment. “We be­lieve that cronos Group’s ex­cel­lent man­age­ment team has built ca­pa­bil­i­ties nec­es­sary to com­pete glob­ally, and we look for­ward to help­ing cronos Group re­al­ize its sig­nif­i­cant growth po­ten­tial.”

cronos will re­main a cana­dian com­pany, head­quar­tered in toronto, Goren­stein said.

AFP-GETTY IM­AGES FILE

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