TORONTO, Feb. 21, 2019 (GLOBE NEWSWIRE) — Cronos Group Inc. (NASDAQ: CRON) (TSX: CRON) (“Cronos Group” or the “Company”) announced that at a Special Meeting held today, the Company’s shareholders overwhelmingly approved the previously announced strategic investment agreement with Altria Group, Inc. (NYSE: MO) (“Altria”). Pursuant to the agreement, at closing, Altria will make an approximately C$2.4 billion equity investment in Cronos Group (the “Transaction”) on a private placement basis in exchange for common shares (the “Shares”) in the capital of the Company. Altria will also receive Warrants of Cronos Group (the “Warrants”), that if fully exercised, would provide the Company with an additional approximately C$1.4 billion of proceeds. The Shares issuable to Altria will result in Altria holding an approximately 45% ownership interest in Cronos Group (calculated on a non-diluted basis) and exercise of the Warrants would result in incremental ownership of 10% for a total potential ownership position of 55%.
“We are very pleased to have received this approval and look forward to realizing the many benefits and value creation enabled by Cronos Group’s partnership with Altria,” said Mike Gorenstein, CEO of Cronos Group. “Altria’s expertise and complementary capabilities will better position Cronos Group to support our efforts in cannabinoid innovation, as well as the creation of differentiated products and brands across medical and recreational channels and throughout our global network.
Of the approximately 40.18% of common shares represented, in person or by proxy, at the special meeting of shareholders held on February 21, 2019, to approve the Transaction (the “Meeting”) approximately 98.46% of such common shares were voted in favor of the resolution approving the Transaction. In addition, each of Altria’s nominees to the board of directors of Cronos Group (the “Board”) were elected conditional upon and effective as of the closing of the Transaction. The detailed results of the vote for the election of Altria’s nominees are set out below:
Upon the closing of the Transaction, the Company’s Board will be reconstituted to consist of Jason Adler, Kevin C. Crosthwaite Jr., Bronwen Evans, Murray R. Garnick, and Bruce A. Gates, Mike Gorenstein and James Rudyk.
Subject to the satisfaction or waiver of all the conditions to the Transaction, including the receipt of approval under the Investment Canada Act, the Transaction is expected to be completed by the end of March 2019.
About Cronos Group
Cronos Group is a globally diversified and vertically integrated cannabis company with a presence across five continents. Cronos Group operates two wholly-owned Canadian licensed producers: Peace Naturals Project Inc., which was the first non-incumbent medical cannabis license granted by Health Canada, and Original BC Ltd., which is based in the Okanagan Valley, British Columbia. Cronos Group has multiple international production and distribution platforms across five continents. Cronos Group intends to continue to rapidly expand its global footprint as it focuses on building an international iconic brand portfolio and developing disruptive intellectual property. Cronos Group is committed to building industry-leading companies that transform the perception of cannabis and responsibly elevate the consumer experience.
Altria’s wholly-owned subsidiaries include Philip Morris USA Inc., U.S. Smokeless Tobacco Company LLC, John Middleton Co., Sherman Group Holdings, LLC and its subsidiaries, Nu Mark LLC, Ste. Michelle Wine Estates Ltd. (Ste. Michelle) and Philip Morris Capital Corporation. Altria holds an equity investment in Anheuser-Busch InBev SA/NV (AB InBev).
The brand portfolios of Altria’s tobacco operating companies include Marlboro®, Black & Mild®, Copenhagen®, Skoal®, VERVE®, MarkTen®, and Green Smoke®. Ste. Michelle produces and markets premium wines sold under various labels, including Chateau Ste. Michelle®, Columbia Crest®, 14 Hands® and Stag’s Leap Wine Cellars™, and it imports and markets Antinori®, Champagne Nicolas Feuillatte™, Torres®, and Villa Maria Estate™ products in the United States. Trademarks and service marks related to Altria referenced in this release are the property of Altria or its subsidiaries or are used with permission. More information about Altria is available at altria.com and on the Altria Investor app.
Take a closer look at Altria and its companies on altria.com.
Follow Altria on Twitter at @AltriaNews.
Source: Cronos Group Inc.
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