Canada-based marijuana cultivator Cronos Group has agreed to buy a a hemp producer that distributes CBD products in the United States.
Cronos announced the news this past Friday, stating that it has agreed to purchase Redwood Holding Group for $300 million. The company produces CBD-infused products under the brand name Lord Jones and sells through US retailers. Products include body lotion and bath salts.
Shares jumped on the news as investors digested that Cronos would now have an opportunity to take advantage of the monstrous CBD market in the U.S.
Shares of Cronos were up as much as 5.5% on the announcement.
“Rob and Cindy have built a differentiated, best-in-class platform with hemp-based CBD formulations that stand for quality and consistency,” said Mike Gorenstein, the CEO of Cronos. Robert Rosenheck and Cindy Capobianco are the founders of Redwood.
“Our goal is to preserve the integrity of all Rob and Cindy have created, while also learning from them and leveraging Cronos Group’s resources to capitalize on the significant demand for skincare and other consumer products derived from hemp.”