BRITISH tobacco giant Imperial has demonstrated its ambition in the legal cannabis industry with a second foray into the sector.
A recent £75m investment will provide Canadian firm Auxly Cannabis Group access to Imperial’s vaping technology.
This follows its initial investment into fellow UK firm Oxford Cannabis Technologies (OCT) in June, 2018.
Imperial, which makes the Lambert & Butler and Golden Virginia tobacco brands, say the Auxly move is part of an ongoing diversification strategy, which has seen it develop a growing presence in the heated tobacco and electronic vaping sectors.
Matthew Phillips, Imperial’s Chief Development Officer said: “Diversifying our Next Generation Product portfolio with this investment provides Imperial with further options for future growth and builds on last year’s investment in Oxford Cannabinoid Technologies.”
Toronto-listed Auxly is strongly focused on developing the ‘Generation 2’ Canadian cannabis products, namely; edibles, vapes and lotions which were approved for sale last last year.
The deal gives Bristol-based Imperial a 19.9% stake in Auxly through a three-year convertible loan at a price of 81 cents per share.
OCT is a medical cannabis research company, Backed by Snoop Dogg’s venture firm and Star Wars actor Patrick Stewart, which says it aims to ‘unravel the secrets of a plant that has been stigmatised for decades’.
Imperial is the latest consumer goods company to make a foray into cannabis. Last year Marlboro maker Altria Group announced a $2.4 billion investment in Cronos Group.
Tilray has struck an agreement to collaborate on medical cannabis with Sandoz AG, part of the Novartis pharmaceutical Group and Canada’s Canopy Growth is receiving over $5 billion of investment from alcohol giant Constellation Brands.