Altria to Make Growth Investment In Cronos Group

Altria to Invest USD $1.8 Billion (CAD $2.4 Billion) for 45% Ownership Interest in Leading Global Cannabinoid Company with Warrant to Increase Ownership to 55% Over Next 4 Years

VIRGINIA: Altria Group today announced that it has entered into an agreement to acquire newly issued shares in Cronos Group, a leading global cannabinoid company, headquartered in Toronto, Canada. The transaction represents a 45% equity stake in Cronos Group, at a price of CAD $16.25 per share, for an aggregate investment by Altria of approximately USD $1.8 billion (approximately CAD $2.4 billion).

As part of the agreement, at closing, Altria will have the right to nominate four directors, including one independent director, to serve on Cronos Group’s Board of Directors, which will be expanded from five to seven directors. The agreement includes a warrant to acquire an additional ownership interest in Cronos Group at a price of CAD $19.00 per share exercisable over four years from the closing date. If exercised in full, the warrant would increase Altria’s ownership in Cronos Group by 10% to approximately 55%.

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“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. “We believe that Cronos Group’s excellent management team has built capabilities necessary to compete globally, and we look forward to helping Cronos Group realize its significant growth potential.”

“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’s 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. Importantly, Altria shares our vision of driving long-term value through innovation, and we look forward to continuing to differentiate Cronos Group in this area.”

This investment positions Altria to participate in the emerging global cannabis sector, which it believes is poised for rapid growth over the next decade. It also creates a new growth opportunity in an adjacent category that is complementary to Altria’s core tobacco businesses.

Altria expects its investment to help Cronos Group accelerate its growth strategies and its R&D and intellectual property development. Additionally, Altria will provide expertise to help Cronos Group thrive in the growing global cannabis market. These services may include regulatory affairs, regulatory science, compliance, government affairs and brand management.

West Virginia Legislature Approves Medical Marijuana Bill

WEST VIRGINIA: A medical marijuana bill received final approval in the West Virginia Legislature on Thursday and is headed to the desk of Gov. Jim Justice. He has publicly expressed support for legal access to medical marijuana and is expected to sign the bill into law, making West Virginia the 29th state to adopt an effective medical marijuana law.

SB 386, introduced by Sen. Richard Ojeda (D-Logan), received initial approval from the Senate last week (28-6). The House substantially amended the bill before approving it on Tuesday (76-24). The Senate passed the new version on concurrence Wednesday afternoon (28-6), along with some minor amendments, and the House signed off on the final version Thursday (74-24).

“Some of the House amendments to the bill are concerning, but it still has the potential to provide relief to thousands of seriously ill WestVirginians,” said Matt Simon of the Marijuana Policy Project (MPP), who is a West Virginia native and graduate of West Virginia University. “We commend the Legislature for passing this compassionate and much-needed legislation, and we encourage Gov. Justice to sign it into law.

“This will be an important and, in some cases, life-saving program,” Simon said. “It is critical that the state implement it promptly. We are committed to working with officials to make sure the program is as effective as possible and to get it up and running in a timely fashion. Many patients cannot afford to wait much longer.”

SB 386, titled the West Virginia Medical Cannabis Act, charges the Bureau of Public Health with regulating medical marijuana growers, processors, and dispensaries. Patients with specifically listed qualifying medical conditions will be allowed to use extracts, tinctures, and other preparations of marijuana, but not marijuana in flower or leaf form. This differs from the original version of the bill and the medical marijuana programs in most other states. A summary of SB 386 is available at http://bit.ly/2nbUAq3.

“There is nearly universal support for legalizing medical marijuana in the U.S., and it spans the political spectrum,” Simon said. “This is the third state in a row to pass a medical marijuana bill through a Republican-controlled House and Senate. Hopefully, this is a trend that will continue with some other states and at the federal level.”

A February 2017 Quinnipiac University Poll found 93% of U.S. voters think marijuana should be legal for medical purposes. Twenty-eight states, the District of Columbia, and the U.S. territories of Guam and Puerto Rico have enacted effective medical marijuana laws, and 18 states have adopted medical marijuana laws that are ineffective because they are either unworkable or exceptionally restrictive. Once S.B. 386 is signed into law, only three states in the nation — Idaho, Indiana, and Kansas — will lack any form of medical marijuana law.

Details Of West Virginina Medical Marijuana Bill Unveiled

WEST VIRGINIA: State lawmakers got their first glimpse Wednesday of a draft bill that would legalize the use of marijuana for medical purposes in West Virginia.

A joint House-Senate health committee unveiled the proposed legislation that would allow people with specific illnesses, such as cancer, to possess up to six ounces of marijuana and a dozen marijuana plants and seedlings.

The bill would require people to get a certificate from a doctor to use marijuana. Five nonprofit “compassion centers” across the state would distribute the drug.

“It’s a very well-written and comprehensive bill,” said Mike Manypenny, D-Taylor, who has sponsored similar legislation in past years. “It’s a step in the right direction to now get feedback from members [of the Legislature] to see what concerns they may have.”

 

Details Of West Virginina Medical Marijuana Bill Unveiled

WEST VIRGINIA: State lawmakers got their first glimpse Wednesday of a draft bill that would legalize the use of marijuana for medical purposes in West Virginia.

A joint House-Senate health committee unveiled the proposed legislation that would allow people with specific illnesses, such as cancer, to possess up to six ounces of marijuana and a dozen marijuana plants and seedlings.

The bill would require people to get a certificate from a doctor to use marijuana. Five nonprofit “compassion centers” across the state would distribute the drug.

“It’s a very well-written and comprehensive bill,” said Mike Manypenny, D-Taylor, who has sponsored similar legislation in past years. “It’s a step in the right direction to now get feedback from members [of the Legislature] to see what concerns they may have.”