TORONTO, Aug. 29, 2018 /PRNewswire/ - Cronos Group Inc.
(NASDAQ: CRON) (TSX: CRON) ("Cronos Group" or the
"Company"), is pleased to announce that it has entered into
a joint venture agreement with an affiliate of Agroidea SAS
("AGI"), Colombia's leading
agricultural services provider with over 30 years of research,
development and production operations. This partnership establishes
a newly formed entity, NatuEra S.à r.l. ("NatuEra"), in
Colombia that will develop,
cultivate, manufacture and export cannabis-based medicinal and
consumer products for the Latin American and global markets.
NatuEra is a 50/50 joint venture between Cronos Group and an
affiliate of AGI. It will be led by AGI's executive team, brothers
Andres Nannetti and Nicolas Nannetti, who have extensive
multi-generational expertise managing industrial scale
horticultural operations for export from Colombia. Their experience includes the
acquisition, re-structuring and management of Dole Food's Fresh-Cut
Flower Division, one of the world's largest flower growing
operations, with a greenhouse cultivation footprint of over 1,020
acres. Currently, AGI's sophisticated business model provides
services through five business units: a micro-propagation and
tissue culture laboratory, plant production services, a plant
health laboratory, plant genetics improvement, and a SaaS model for
delivering online agricultural management tools. AGI has a roster
of global clients, from producers such as Dole, food processors
like Frito-Lay (Pepsico) and McCain, to agri-suppliers such as
Bayer Agriculture and BASF.
NatuEra plans to develop its initial cultivation and
manufacturing operations with a custom-built facility on 207 acres
of available land located in Cundinamarca, Colombia. The natural environment and climate
conditions of this region are particularly well suited for the
growth of cannabis. Colombia is a
global leader in tropical agricultural products for export and is
poised to play a pivotal role as the cannabis industry expands
globally and new markets continue to open. To take full advantage
of Colombia's strategic
positioning in the Latin American and global markets, the
state-of-the-art facility is expected to be designed to meet GAP
and GMP requirements and standards for cultivation, extraction,
manufacturing and export activities. NatuEra intends to become the
world's leading production platform for premium quality, certified
cannabis and cannabinoid-derived products, creating the cannabis
industry's first Contract Manufacturing Organization ("CMO")
in Latin America. As a CMO,
NatuEra intends to allow the growing number of cannabis brands
worldwide to outsource their development, cultivation, and/or
manufacturing activities.
Under the terms of the joint venture, each partner will
contribute capital as required by NatuEra to fund facility
construction and operating expenditures. NatuEra will combine the
operational expertise of Cronos in the production and global
commercialization of medicinal cannabis products with the expertise
in industrial scale cultivation, meristem laboratory operations,
and local market experience of AGI's management team. Construction
of the facility remains subject to obtaining the relevant permits
and other customary approvals. Commencement of operations at the
facility will be subject to obtaining the appropriate licenses
under applicable law.
"We searched extensively for the right partner in Latin America. In AGI we have found an
executive team with immense experience in running large scale
horticultural operations and serving the needs of large,
sophisticated international clients which will be crucial in
establishing consistent and efficient supply chains for cannabinoid
based products," said Mike
Gorenstein, CEO of Cronos Group. "By leveraging AGI's
expertise and Cronos Group's cannabis know-how, NatuEra will enable
Cronos Group to create a cultivation and manufacturing hub in
Latin America for our global
distribution channels in a manner that minimizes region-specific
and execution risk."
"We are very excited to partner with Cronos Group in
establishing the cannabis industry's first CMO," said Andres Nannetti, Executive Chairman of NatuEra.
"Cronos Group has a demonstrated an ability to generate enormous
value in a short period of time. Their deep domain expertise,
extensive global distribution network and stellar industry
reputation will accelerate the growth of NatuEra as we position the
company to serve the needs of Cronos Group and other leading global
cannabis producers."
"AGI's process-driven approach to agriculture is perfectly
suited to the challenges of producing high-quality cannabis and a
true differentiator in today's market. We are proud that Cronos
Group recognized this value in choosing us as their partner, and we
look forward to creating in NatuEra a CMO that will support the
growth of the global cannabis industry." Nicolas Nannetti, CEO of NatuEra.
Andres Nannetti, Executive
Chairman, NatuEra
Andres
Nannetti is a Managing Director of Leawood Investments, a
private holding company based in Panama with investments in Latin America and the U.S. The primary
investment areas of focus include large tract land holdings, real
estate development, and agri-business in Colombia. Mr. Nannetti previously served as
CEO of Sunburst Farms Inc., one of the largest importers and
distributors of fresh cut flowers in the U.S., acquired from Dole
Food Company and subsequently sold in 2011. Mr. Nannetti was CEO
and Co-founder of Rovia, Inc. a venture backed DRM software company
acquired by CYA Technologies, (now Enchoice) in 2002. Mr. Nannetti
began his career at JP Morgan in the Latin America M&A and
Morgan Capital Private Equity Group. Mr. Nannetti holds an
MBA from Stanford GSB and a BS in Economics from MIT.
Nicolas Nannetti, CEO,
NatuEra
Nicolas Nannetti was
previously CEO of the Americaflor group of companies, a collection
of large tract flower growing operations purchased from Dole Food
Company as distressed assets. Mr. Nannetti led the restructuring
and streamlining of Americaflor where he oversaw 13 growing
operations, a processing facility, and over 4,000 employees. Mr.
Nannetti also serves as Executive Chairman of AGI, where he has led
its transformation into Colombia's
leading agricultural services company. Prior to his role at
Americaflor, Mr. Nannetti was a Managing Director at Leawood
Investments where he co-led the LBO of a Colombia and Ecuador based flower conglomerate. Mr.
Nannetti began his career as a management consultant at Monitor
Group (now Deloitte), where he advised blue-chip clients on growth
strategies and process management. Mr. Nannetti holds an MBA from
Columbia Business School and a BS in
International Political Economy from Georgetown University.
About Cronos Group
Cronos Group is a globally
diversified and vertically integrated cannabis company with a
presence across four continents. The Company operates two
wholly-owned Canadian licensed producers regulated under Health
Canada's Access to Cannabis for Medical Purposes
Regulations: Peace Naturals Project Inc., which was the
first non-incumbent medical cannabis license granted by Health
Canada, and Original BC Ltd., which is based in the Okanagan
Valley, British Columbia.
The Company has multiple international production and
distribution platforms including in Germany, Poland, Israel and Australia. The Company intends to
continue to rapidly expand its global footprint as it focuses on
building an international iconic brand portfolio and develop
disruptive intellectual property. Cronos Group is committed
to building industry leading companies that transform the
perception of cannabis and responsibly elevate the consumer
experience.
Forward-looking statements
This news release contains
"forward-looking information" and "forward-looking statements"
within the meaning of applicable Canadian and U.S. securities laws.
All information contained herein that is not clearly
historical in nature may constitute forward-looking information.
In some cases, forward-looking statements can be identified
by words or phrases such as "may", "will", "expect", "plan",
"anticipate", "intend", "potential", "estimate", "believe" or the
negative of these terms, or other similar expressions intended to
identify forward-looking statements. Some of the forward-looking
statements contained in this press release include the suitability
of the natural environment and climate conditions in Colombia for the cultivation of cannabis, the
development, construction and operation of a facility, the nature
of such facility and its operations, including that its operations
will be in a cost efficient manner, the receipt of necessary
funding, permits and other approvals, including applicable
licenses, for the construction and operation of such facility,
NatuEra's ability to supply international markets, NatuEra's
ability to create the first CDMO in Latin
America for the cannabis industry, the Company's intention
to continue to rapidly expand its global footprint, build an
international iconic brand portfolio and develop disruptive
intellectual property. Forward-looking statements are necessarily
based upon a number of estimates and assumptions that, while
considered reasonable by management, are inherently subject to
significant business, economic and competitive risks, uncertainties
and contingencies that may cause actual financial results,
performance or achievements to be materially different from the
estimated future results, performance or achievements expressed or
implied by those forward-looking statements and the forward-looking
statements are not guarantees of future performance. A
discussion of some of the material risks applicable to the Company
can be found in the Company's current MD&A and Annual
Information Form, both of which have been filed on SEDAR and can be
accessed at www.sedar.com. The forward-looking information included
in this news release is made as of the date of this news release
and, except as required by law, Cronos Group disclaims any
obligation to update or revise any forward-looking statements.
Readers are cautioned not to put undue reliance on these
forward-looking statements.
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SOURCE Cronos Group Inc.