Altria acquires stake in Cronos
Earlier this week, several media outlets reported on possible talks between Altria, the maker of Marlboro cigarettes, and Cronos Group (CRON), a Canadian cannabis producer. On December 7, Altria officially announced that it acquired a ~45% stake in the company to the tune of $1.8 billion.
The perception game
Given that Altria has been in the tobacco business for nearly three decades, the cannabis business makes sense for the business. Cannabis is continuing to gain momentum in medical as well as recreational use. What’s more important is the perception behind tobacco and cannabis. While tobacco is largely seen as harmful, cannabis, on the other hand, has a medicinal component that seems to make it a more acceptable alternative to tobacco. This perception could be good news for cannabis companies (HMMJ) such as Cronos, Canopy Growth (WEED), Aurora Cannabis (ACB) (ACBFF), and Tilray (TLRY).
Read One Chart That Shows What Makes Cannabis Attractive to Altria for more information.