British American Tobacco Invests $86.8 Million in Organigram

LOS ANGELES- British American Tobacco (BAT), one of the world’s largest tobacco companies, has finalized a strategic investment of approximately $86.8 million (C$124.6 million) in Organigram Holdings Inc., a prominent Canadian cannabis producer. This investment, executed through BAT’s subsidiary, BT DE Investments Inc., increases BAT’s stake in Organigram to 30% of common shares and grants it 100% ownership of non-voting preferred shares.

The funds are earmarked to accelerate Organigram’s international expansion and product innovation efforts. A portion will be allocated to a strategic investment pool known as “Jupiter,” designed to identify and support growth opportunities in the global cannabis market. Organigram has already deployed parts of this pool, including investments in Germany’s Sanity Group and U.S.-based Phylos Bioscience Inc. ​

This move underscores a broader trend of tobacco companies diversifying into the cannabis industry. In 2018, Altria Group invested $1.8 billion in Cronos Group, acquiring a 45% stake. Similarly, Philip Morris International agreed to purchase Israeli medical cannabis inhaler company Syqe Medical in 2023 for up to $650 million. These investments reflect the tobacco industry’s strategy to explore new markets amid declining traditional cigarette consumption. ​

BAT’s increased involvement in Organigram includes the right to nominate up to 30% of the company’s board of directors, providing significant influence over its strategic direction. This investment aligns with BAT’s goal to diversify its product portfolio and adapt to evolving consumer preferences.