Marlboro maker ‘evaluating opportunities’ in cannabis industry

Altria Marlboro cannabis, Marlboro maker ‘evaluating opportunities’ in cannabis industry

Altria Group, one of the largest tobacco companies in North America, is assessing its market opportunities in the cannabis industry.

The entry of Altria – owner of Marlboro maker Philip Morris USA and an investor in alcohol giant Anheuser-Busch InBev – would be another major milestone for the marijuana sector, coming on the heels of Constellation Brands’ bombshell investment in Canopy Growth last month.

“Cannabis remains illegal under federal law, and we intend to continue to comply with federal law,” Murray Garnick, executive vice president at Altria, said during a fireside chat at the Barclays 2018 Global Consumer Staples Conference.

But the company is also “mindful of the possibility” that cannabis’ legal status may change, he noted. “We’re studying and evaluating market opportunities,” Garnick said.

Robert Fagan, an analyst with GMP Securities in Montreal, says tobacco companies are taking their time with regards to cannabis industry opportunities.

“If anything, they’re waiting for regulations to be crystal clear before diving in,” he said.

And the high valuations the industry has seen? Fagan doesn’t think they’re scaring off potential investors.

“If tobacco companies are evaluating opportunities now, given the huge run up in the space, I don’t think they are too valuation sensitive. My feeling is that they’re not overly concerned with the prices being paid for cannabis companies currently,” he said.

Making their move

Other cigarette makers have already dipped their toes in the cannabis industry.

In June, British tobacco giant Imperial Brands was among investors taking a stake in Oxford Cannabinoid Technologies, a United Kingdom-based medical cannabis startup.

Tobacco titan Alliance One International bought a controlling stake in two Canadian marijuana producers – Canada’s Island Garden and Goldleaf Pharm – in February.

Altria also owns about 10% of AB InBev, whose portfolio includes Budweiser, Corona and Stella Artois.

Alcohol companies have taken the leap into the cannabis space in recent months, as Canada prepares for adult-use legalization along with some U.S. states.

Molson announced plans to form a joint venture with Quebec-based licensed producer Hydropothecary – now called Hexo – to develop nonalcoholic, cannabis-infused beverages.

Canada’s beer industry has expressed concern that the recreational marijuana market will cut into its profits, and even asked the government to raise the cannabis tax to level the playing field.

Matt Lamers can be reached at [email protected]

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13 comments on “Marlboro maker ‘evaluating opportunities’ in cannabis industry

    With Coors Marlboro and Pharma like CW entering the industry how will the US Government allow them to cannibalize the market space while blocking US small business from any banking?

    Is the some type of cooperation going on between US Gov and Canada/Mexico? Their drugs and money seem to be able to trade in our stock exchange and use the monies made from their cannabis sales into US banks, businesses and stock market!!!!!!!!!!!!!!

    I now know from many many individuals in retail in US space that in fact illegal drugs from these markets are being sold in US. As a matter of fact several recent articles show 1 in 5 retail cannabis sales in US is legal. This means 80%!!!!!!!!!!! are illegal.

    So. I ask the question again. Why can’t US small business get access to banking?

  2. ron youngblood on

    Seriously people to let the tobacco industries touch cannabis is a major mistake for all people that enjoy cannabis. We all seen what they did to cigarettes and are now admitting it on tv commercials. This is placing the fox in the hen house to guard or shall I say eat the chickens. This is just as wrong as it gets!!! The big companies would like nothing better than to get their users addicted by adding some crap as they did in cigarettes!!

  3. Michael M Hassan on

    The USA government has its head in the sand on this and has since the 30’s. We can only hope they pull it out and the sooner the better. There are so many reasons for MJ to be legal it boggles the mind that it is on the Drug 1 list.

    • Monica Pua on

      Kim- With all due respect, the falsity that “THC is addictive” is but one of the many myths spread by the US Justice Department and the DEA as a way to create fear and panic around a medicinal plant.

      Please understand that the cannabis plant and all of its components, help keeps thousands of us, medicinal patients, alive and pain free.

  4. Monica Pua on

    Marlboro produces and sells poisonous and terrible damaging products. “Cancer Sticks” is how their cigarettes are commonly known.

    Their business model is to make people ill and eventually, kill them. Do they know that cannabis is an actual medicinal plant? Doubt it.

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