Altria has turned its theoretical exploration of the cannabis sector into reality with a $1.8bn investment in the Cronos Group, a vertically integrated cannabis company.
US tobacco giant Altria has bought a 45% stake in the Canadian company with the option to take a majority 55% stake within the next four years if it chooses – essentially making the deal a potential acquisition rather than simply an investment.
It will also have the right to appoint four of the seven directors of Cronos following the deal closing. Altria chairman and CEO Howard Willard said Cronos would become Altria’s exclusive partner in the emerging global cannabis category.
Mike Gorenstein, chairman, president and CEO of Cronos, said: “The proceeds from Altria’s investment will enable us to more quickly expand our global infrastructure and distribution footprint, while also increasing investments in R&D and brands.”
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