Author: Stephen Johnson / Source: Big Think
- The deal includes the option for Altria Group to take a 55 percent stake in the Cronos Group over the next five years.
- It marks a continuing trend of big tobacco companies moving into the marijuana industry.
- If legalized at the federal level in the U.S., the marijuana industry could shape up to be like the current alcohol market in the U. S.
Big tobacco companies have been quietly eyeing a move into the marijuana industry for decades. Now, as cigarette sales slump and more states move to legalize marijuana, big tobacco is finally gearing up for its long-awaited move.
On Friday, Altria Group Inc., maker of Marlboro cigarettes, said it’s taking a 45 percent stake in Cronos Group, a major Canadian medical and recreational marijuana provider. The deal amounts to a $1.8 billion investment and includes an option to increase its stake to 55 percent over the next five years.
“Investing in Cronos Group as our exclusive partner in the emerging global cannabis category represents an exciting new growth opportunity for Altria,” said Howard Willard, Altria’s Chairman and Chief Executive Officer.
Per the agreement, Altria will be able to nominate four members to Cronos Group’s board of directors, which will increase…
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