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Marlboro owner Altria invests $1.8 billion in cannabis company Cronos
Altria hopes pot is the key to help it grow beyond its stagnant cigarette business. Tobacco giant Altira is investing $1.8 billion in Canadian cannabis company Cronos Group. That will give Altria a 45% stake in the company, with an option for Altria to increase its stake to 55% over the next five years. Reports of an Altria-Cronos deal first surfaced earlier this week. The decision by Altria to go ahead with an investment in Cronos shows that Altria is serious about investing in marijuana as a new growth area as sales of traditional cigarettes slow. Altria's stock has fallen nearly 25% this year and the company is expected to report revenue growth of only about 1% this year and in 2019.
[...] Cronos and other cannabis stocks have been thrust into the spotlight in the past few months following the legalization of recreational marijuana in Canada in October, as well as legalized recreational and medical pot in several US states last month. With Democrats winning control of the US House, Congress may finally pass the Farm Bill, which would make it legal to produce hemp and potentially open the door for more products containing cannabidiol, or CBD. Many alcoholic beverage, tobacco and other consumer products companies may want to bet on cannabis. Canadian marijuana company Canopy Growth (CGC) already has received a multibillion dollar investment from Corona owner Constellation Brands (STZ). Coca-Cola (KO) was rumored to be considering an investment in Canadian cannabis company Aurora (ACB). [...] Coke's archrival Pepsi (PEP) hasn't completely ruled out a move into cannabis.
Altria's Canadian Pot Bet Is Really About the U.S.
It's official: Big Tobacco is now a player in the cannabis market. That will change the game.
Previously: Another Major Beermaker is Looking at Ways to Enter the Cannabis Business
Coca-Cola Is Eyeing the Cannabis Market
Peter Thiel's Cannabis Company Was Briefly Worth More Than Twitter
Cannabis Becomes Legal in Canada
(Score: 2) by dry on Monday December 10 2018, @03:25AM
Cannabis prohibition did start out as racial, those Mexicans used it, just like cocaine was black people and opium was oriental. When it really took off was when it threatened Hearst s new pulp paper industry as a machine had been invented to separate the fiber cheaply and hemp made better cheap paper then trees. The chemical industries didn't like it either, hemp seed oil was big business until prohibition and the promises of the cellulose left over after the fiber was separated had many promising uses.