Bank of Montreal’s Subsidiary Signs $100M Deal With Cannabis Company Cronos

BMO Nesbitt Burns Inc., an investment banking subsidiary for the Bank of Montreal, is leading with a $100 million deal with marijuana company Cronos Group Inc., The Financial Post reported on Thursday.

Co-led by GMP Securities L.P.,  the deal was announced Thursday. Its underwriters will acquire 10.4 million Cronos common shares, or 12 million if the over-allotment is taken, at a price of $9.60 a share.

The deal shows that the Bank of Montreal is on the forefront of the “big five” Canadian banks in investing in the ever-growing cannabis industry.

In January, the bank became the first to delve into the marijuana market when it co-led a $175-million bought deal, again with GMP, for Canopy Growth Corp.

Cronos is eying an international expansion and is spending $15 million of its proceeds from its latest financing deal for this purpose.

The Financial Post said Cronos is currently building a greenhouse and extraction lab facility in Israel and recently announced plans for a facility in Australia.