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Marlboro Maker Investing $2.4 Billion in Canadian Cannabis Producer Cronos

December 7, 2018
Cronos(1001Love/iStock)
Canadian cannabis producer Cronos Group announced Friday that it will receive a $2.4 billion equity investment from Altria Group, the maker of Marlboro cigarettes.

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Cronos had previously confirmed reports that it was in talks with Altria, which joins Molson Coors, Constellation Brands, and other established companies that are making moves in the cannabis space.

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For its initial investment, the tobacco giant will acquire a 45% ownership stake in Cronos. The arrangement also allows for Altria to invest up to a further $1.4 billion to increase its ownership stake in Cronos to 55%.

“Altria is the ideal partner for Cronos Group, providing the resources and expertise we need to meaningfully accelerate our strategic growth,” said Mike Gorenstein, Cronos Group Chairman, President, and Chief Executive Officer. “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 that resonate with our consumers.”

According to a news release, Altria’s resources will better position the Cronos Group “to support cannabinoid innovation, create differentiated products and brands across medicinal and recreational categories, and expand its global footprint and growing production capacity.”

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The deal will leverage Altria’s decades of experience navigating the complex regulatory landscape, government affairs, compliance, and brand management. Tapping into Altria’s expertise in product development, Chronos also expects to expand its product offerings including device technologies such as cannabis vape products, as regulations permit.

With files from The Canadian Press.

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Leafly Canada is based in Toronto, with correspondents and contributors stretching from Newfoundland to BC. To reach our editorial staff please contact us at info@leafly.com.

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  • Dante-the-cat

    Yay. Big tobacco is now involved with cannabis.

    They go together like Trump and Gandhi.

  • Sonny Cole

    marlboro will turn a harmless plant into a killer weed within a year.
    marlboro will try and put something in the cannabis to try and improve what mother nature has given us.
    greed has taken over just like the cartel in mexico.
    this is why cannabis will not be legal in the u.s. greed has taken over

  • Robert Gerus

    Finally a cigarette that won’t kill you if made with marijuana, unless your fenn and got to have your 20 packs a day like a lot of marijuana smokers one after another, chainsmokers. You know the kind one joint’s not enough, with me if the THC is good one joint in the morning good for most of the day and one in the evening after a good supper, if it’s good I don’t abuse it.

  • GBAUTO

    Had to realize that this was coming. Joe Blue Collar doesn’t care where his smoke comes from any more than what’s in his Budweiser…

  • Randy Rorschach

    We all saw this coming smh

  • Roy Wilson

    well I can see this is not going to be an intelligent forum