Altria group Inc just bought 45% stake in Cronos Group Friday.
Cronos is a Canadian medical and recreational marijuana distributor.
The tobacco giant is willing to pay another $1.4 billion
Altria will pay another $1.4 billion for warrants that if exercised, would give the Altria a 55 percent ownership stake in the Toronto company.
That would mean Altria’s investment would be in the same league as the $4 billion spent earlier this year by Constellation Brands to acquire shares of Canopy Growth Corp., another Canadian pot producer.
Earlier this year, Coca-cola announced its interest in cannabis-infused drinks. The drink giant dropped a couple billion dollars in the pot business
Larger corporations in the United States are starting to eyeball the industry.
Shares of Cronos Group Inc. jumped 31 percent and neared an all-time high at the opening bell Friday.
Rapid growth in the cannabis market is expected to continue as legalization expands in the U.S. and social norms change. On Tuesday, ultra-conservative Utah became the latest state to legalize marijuana use for medical purposes.
Consumers are expected to spend $57 billion per year worldwide on legal cannabis by 2027, according to Arcview Market Research, a cannabis-focused investment firm. In North America, that spending is expected to grow from $9.2 billion in 2017 to $47.3 billion in 2027.