Toronto-based cannabis company Cronos Group Inc. (NASDAQ: CRON; TSX: CRON) today sees a major tobacco exec joining its board of directors.
A spot on the board opened recently with the resignation of former member K.C. Crosthwaite, who moved into the position of Chief Executive Officer at besieged vape company JUUL Labs last week following the ouster of former CEO Kevin Burns.
Crosthwaite’s spot on the board is now filled by Jody Begley, who previously worked at Philip Morris USA and led vape product development as President and General Manager of Nu Mark. Begley is currently working as Senior Vice President of Tobacco Products for Altria Group.
In accordance with the terms of a $2.4 billion investment in Cronos Group earlier this year, Altria has the right to appoint up to four members to the Cronos board. That investment saw Altria gaining a 45% stake in Cronos Group.
Altria has also previously invested in JUUL, which is currently experiencing major senior management shakeups as 12 deaths from a vaping-related lung disease have made headlines across the United States.
While the Centers For Disease Control And Prevention have so far linked the 800+ suspected cases of lung disease primarily to non-licensed THC products and not to nicotine vapes used as an alternative to tobacco, the negative press has caused JUUL to stop all advertising.
More trouble may be brewing for the e-cigarette company, as the Food And Drug Administration is currently considering a ban on all flavoured vape products.
In other Cronos Group news, the company closed on the acquisition of Redwood Holdings early last month, making a major move into U.S. CBD operations. With that deal closed, Cronos Group now has control of the Lord Jones line of CBD products.
Chairman and CEO Mike Gorenstein also presented at the CIBC 18th Annual Eastern Institutional Investors Conference in Montreal late last month, capping off a busy year of business conference attendance to bring more exposure to the cannabis and CBD industries.
Cronos Group stock has seen a slight uptick this morning to $9.27 a share, although the price has maintained a steady downward trend since early March when it was trading for $23.70.
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