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Altria investing $2.4B in Canadian cannabis producer Cronos

Last Updated Dec 7, 2018 at 8:14 am EDT

Marijuana plants are shown at a cultivation facility in Olds, Alta., on Oct. 10, 2018. THE CANADIAN PRESS/Jeff McIntosh

Canadian cannabis producer Cronos Group says it will receive a $2.4 billion equity investment from Altria Group, one of the biggest tobacco companies in the world.

The maker of Marlboro cigarettes would acquire a 45 per cent ownership stake in Cronos under the initial investment.

Altria can also invest up to a further $1.4 billion to increase its ownership stake in Cronos to 55 per cent, under the arrangement.

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.

The president and CEO of Cronos, Mike Gorenstein, says the agreement with Altria will give the Toronto-based company the resources to expand more quickly and increase its investments in research and development.