Menu

Deal Alert: Altria Group buys mammoth stake in Canadian cannabis giant Cronos Group

By Toby |

Phillip Morris-parent Altria Group, Inc. (MO) today announced a deal to invest CAD 2.4 billion (about $1.8 billion) in Toronto-based cannabis giant Cronos Group (CRON).

The equity investment on a private placement basis is in exchange for common shares in Cronos. In addition to this, Altria will also receive Cronos warrants, that if fully exercised, would be an additional C$1.4 billion in proceeds.

At the close of the deal, Altria would hold about 45% ownership interest in Cronos Group shares. Factoring in the exercise of the warrants, the total potential ownership position of Altria would be about 55%.

Marijuana or weed stocks

 

“This strategic partnership provides Cronos Group with additional financial resources, product development and commercialization capabilities, and deep regulatory expertise to better position the Company to compete, scale and lead the rapidly growing global cannabis industry,” read a statement by the Canadian weed company.

Cronos CEO Mike Gorenstein 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 that resonate with our consumers.”

Under the terms of the deal, Altria has agreed to acquire 146.2 million shares of Cronos at a price of CAD16.25 per share — a 41.5% premium to Cronos’ 10-day volume weighted average price on the Toronto Stock Exchange as of Nov. 30, 2018.

The Cronos group board has unanimously backed the deal, which is expected to close in the first half of 2019.

Once the deal comes through, Altria can nominate four directors, including one independent director, to serve on the Cronos Group board, which will be expanded from five to seven directors.

The agreement also makes Altria the exclusive partner of Cronos Group “for pursuing cannabis opportunities throughout the world.” JPMorgan Chase has already given committed financing of about CAD 2.4 million to Altria for the deal.

 

Follow our Google News edition to get the latest stock market, earnings, and financial news at your fingertips

Advertisement

223 responses to “Deal Alert: Altria Group buys mammoth stake in Canadian cannabis giant Cronos Group”

  1. regional

    […]Wonderful story, reckoned we could combine a number of unrelated data, nevertheless truly worth taking a appear, whoa did one study about Mid East has got more problerms at the same time […]

  2. FiverrEarn

    […]Wonderful story, reckoned we could combine several unrelated data, nonetheless seriously worth taking a appear, whoa did one particular find out about Mid East has got more problerms too […]

  3. Streamer

    […]Wonderful story, reckoned we could combine some unrelated data, nonetheless seriously really worth taking a look, whoa did one particular understand about Mid East has got additional problerms also […]

  4. FiverrEarn

    […]Wonderful story, reckoned we could combine a number of unrelated information, nonetheless actually worth taking a appear, whoa did 1 learn about Mid East has got far more problerms at the same time […]

  5. gifts

    […]we prefer to honor quite a few other web web-sites on the internet, even though they aren’t linked to us, by linking to them. Below are some webpages really worth checking out[…]

  6. cheap sex cams

    […]Wonderful story, reckoned we could combine a few unrelated data, nonetheless seriously worth taking a look, whoa did a single find out about Mid East has got additional problerms at the same time […]

  7. wix seo

    […]we like to honor several other internet websites on the web, even when they aren’t linked to us, by linking to them. Underneath are some webpages really worth checking out[…]

Leave a Reply

Top