Say goodbye to ‘Marlboro Man’ and get ready for ‘Marijuana Man.’ Big Tobacco just moved into the cannabis industry.

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Marijuana plants grow in the Mother Room at the Canopy Growth Corp. facility in Smith Falls, Ontario, Canada, on Tuesday, Dec. 19, 2017. Canadian medical marijuana is setting the stage to go global. The country's emerging legal producers have a chance to seize opportunities in other countries that could make them worldwide leaders, according to Canopy Growth Corp. Chief Executive Officer Bruce Linton.

Source – https://www.nj.com/marijuana/2019/01/say-goodbye-to-marlboro-man-and-get-ready-for-marijuana-man-big-tobacco-moves-into-the-cannabis-industry.html

With a shrinking marketplace for their products, tobacco companies — unsurprisingly — are looking to adapt to the changing marketplace.

Take, for instance, the maker of Marlboro cigarettes, Altria.

Last month, Altria announced it was abandoning its e-cigarette brands as it eyed “reduced-risk tobacco product opportunities,” including but not limited to a minority ownership stake in Juul, as well as a partnership with Philip Morris on its tobacco vape, pending FDA approval.

lso, you may have heard Altria invested nearly $2 billion in Cronos Group, the Canadian cannabis company, purchasing a 45 percent ownership interest with an option to acquire more.

Altria is the fourth largest tobacco company in the world, with Philip Morris International, British American Tobacco, and Imperial Tobacco taking the top three spots, respectively.

What does this mean for the cannabis industry as a whole?

As “The Bigs” look to move in — whether it’s Big Tobacco, Big Alcohol, Big Pharma or Big Beverage — it means many in the nascent legitimate cannabis industry are prime targets for acquisition.

“In our view, the confluence of legislative momentum toward legalization and the growing interest of traditional companies to enter the space will see major deals between (Management Service Organizations) that offer scale, unique capabilities, and professionalism,” Acreage Holdings CEO Kevin Murphy told NJ Cannabis Insider. “It could be (mergers and acquisitions) or partnership, but big beverage, pharma, and tobacco companies are circling the wagons.”

Kris Krane, president of 4Front Ventures, said the tobacco industry took note of Constellation Brands’ $4 billion investment in Canopy Growth, so large operators are looking for their own “first-mover advantage.”

“Whether this is a good thing for the cannabis industry remains to be seen,” Krane said. “The arrival of large-scale corporate players give the industry more legitimacy and will likely accelerate the timeline of legislative change in the U.S. and abroad. At the same time, cannabis business has traditionally been run by people with a strong belief in the plant and its positive benefits, something that could be at risk if these companies bring with them some of the business ethics that have plagued the tobacco industry.”

Still, players within the industry see this as what’s in store for the future.

“With Altria joining the likes of Constellation Brands, beverage and tobacco companies investing in the cannabis industry is an indication of what we will see a lot more of as we head into 2019,” said MGO-ELLO Alliance CEO Evan Eneman. “As we continue to advise and navigate cannabis businesses through complex financial transactions, we know that one of the questions that is top-of-mind will be how this move will position them for investment targeted by major corporations.”

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