Altria Looking to Purchase Cannabis Company Cronos
The tobacco industry is bearing the pressure of sales decline lately as there are just fewer younger people who are beginning to smoke while the older smokers have mostly died. There is now pressure on Marlboro cigarette manufacturer Altria in order to buy Cronos Group, a Canadian cannabis company. As the lowest point in the volume of cigarette smoking in the United States has arrived, according to information from the Centers for Disease Control and Prevention, the e-cigarette and cannabis industries are booming. Altria is now in the early stages of talks regarding its plan to buy Cronos. According to Reuters, the long-time Marlboro cigarette maker wants to seek diversification for its traditional smoking business. Altria is also considering a small but important stake in Juul, an e-cigarette company. The source of information was people who refused to be identified since the matter is sensitive. Altria did not want to comment at first. On the other hand, Cronos made confirmations about currently engaging in discussion with Altria Group about the possibility of an investment in Cronos Group. So far, Cronos has not expressed agreement on any deal and that they are not sure if the outcome of the deal will be a positive one, these people said. The company statement said the same thing – there has been no agreement that was reached as to the talks between Altria and Cronos. The statement also mentioned the same lack of guarantee on any positive outcome that may transpire. For now, according to the Marijuana Business Daily, the total demand for cannabis has reached an estimated $52.5 billion. This includes sales from legal stores and the black market. At the same time, based on Wells Fargo analyst Bonnie Herzog, the e-cigarette industry is gaining momentum and is expected to hit $6.6 billion in sales this year in the US alone.