It looks as though big tobacco is coming to the cannabis industry sooner than we had expected. This week Atria Group Inc., one of the biggest of the major tobacco companies in the US announced that they were investing a significant amount of money in Canadian cannabis company Cronos Group. They stand to make a lot of money off of this business venture—nonetheless it is still a bad idea. I’ll get to why in a minute.
Atria announced that they were investing 2.4 billion dollars in Cronos, which comes out to 45 percent ownership, a representative for the company said Friday. Altria even has a plan in place that would allow them to pay an additional 1.4 billion dollars, which would allow them to control 55 percent of the company, bringing it up to 3.8 million dollars. The only other time a major corporation has invested such a large amount of money was when Constellation Brands, makers of Corona, invested 4 billion dollars earlier this year.
Cronos is one of the largest providers of medical and recreational cannabis in Canada. Marlboro is of course one of the most recognizable cigarette brands in the US, with the exception of maybe Camel. I’m old enough to remember when the Marlboro Man was plastered all over billboards. Cigarettes are still the greatest cause of preventable death in the US. Cannabis is just now starting to shed the stigma that it has had for over a century and be seen as legitimate medicine. The last thing we should be associating cannabis with are cigarettes. Big tobacco should butt out of the cannabis business.
Got anything else you want to add? Is this is good move for Atria? Tell us in the comments!