British tobacco giant invests CA$123 million in Canadian cannabis firm Auxly

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Imperial Brands said it will invest 123 million Canadian dollars ($93.4 million) in a British Columbia cannabis company, the United Kingdom tobacco giant’s latest foray into the marijuana industry.

With the investment, Imperial is taking a 19.9% stake in Auxly Cannabis Group, an international cannabis company based in Vancouver, British Columbia.

The two companies also struck a research and development partnership, Auxly said in a news release.

Auxly trades under the ticker symbol CBWTF on the over-the-counter markets and as XLY on the TSX Venture Exchange.

As part of the deal, Auxly is being granted global licenses to Imperial Brands’ vaping technology and intellectual property as well as access to its vapor innovation business, Nerudia.

Auxly also will become Imperial Brands’ exclusive partner for cannabis-related initiatives.

As part of the transaction, Imperial will receive one of the five director positions on Auxly’s board.

The deal is expected to close in the third quarter. More information can be found here.

In 2018, Imperial Brands was among a group of investors taking a stake in a U.K.-based medical cannabis startup.