 Hey guys, this is rich from rich TV live And I wanted to bring you guys one of the biggest pieces of news in the cannabis sector. So Altria buys 45% of Kronos group now I reported this a few days ago and told you guys that this was gonna happen I said this deal is gonna happen and it happened Altria buys 45% of Kronos group for Get this 2.4 billion worth of Options With options to take a controlling stake like unbelievable amount of money. Okay. This was reported yesterday Kronos group Inc. announces 2.4 billion strategic investment from Altria group Inc Kron on the NASDAQ CRON and Kron on the TSX Today announced that it has entered into a subscription agreement with Altria group MO on the New York Stock Exchange now. Look at what it did on Friday up 21% at $12.72 and it has just been on fire I'm gonna mark this so we can really watch this bad boy because it is absolutely on fire on this news This is a huge strategic partnership that is going to make Kronos group a game-changing company on a global scale because they now have a Billion dollar company behind them. Okay, understand this. This is a partnership They are an exclusive partner now of Kronos group This is a game-changer. You can see how it has affected the stock and it was up 21% The news is huge for the sector. I really want you to understand how big this is. Okay So this is pursuant to which Altria has agreed to make Approximately 2.4 billion equity investment Into Kronos group on a private placement basis in exchange for common shares in the capital of the company Altria will also receive warrants of Kronos group that if fully Exercise would provide the company with an additional approximate 1.4 billion of proceeds, that's correct This shares issuable to Altria pursuant to the subscription agreement will result in Altria holding an approximately 45% ownership interest in Kronos group Calculated on a non-deluded basis Exercise of the warrants would result in incremental ownership of 10% for a total which would be a It would be a first position ownership position of the company They would actually own this company if this is to happen, which is very likely for a total potential ownership position like I said of 55% ownership of Kronos group this strategic partnership provides Kronos group with additional Financial resources. This is a move for Kronos group to say. Hey, we want to go global. We now have a Billion dollar partner. Let's take on the world product development and commercialization capabilities and deep regulatory Expertise to better position the company to compete scale and lead the rapidly growing global cannabis industry This is a move because they want to be a first mover Altria is the ideal partner for Kronos group providing the resources and expertise we need to meaningfully Accelerate our strategic growth the proceeds from Altria's investment will enable us to more quickly expand our global infrastructure and Distribution footprint while also increasing investments in R&D. That's your boys initials in Richard in research and development and brands that resonate with our consumers Importantly Altria shares our vision of driving long-term value through innovation and we look forward to continuing to differentiate in this area You can see here Mike Kornstein Kronos groups chairman president and chief executive officer as one of the Largest holding companies in the adult consumer product sector Altria has the deck decades That's right decades of experience in regulatory government affairs Compliance product development and brand management that we expect to leverage Particularly as new markets for cannabis open around the world Investing in Kronos group as our Exclusive understand this is their exclusive partner in the emerging global cannabis category Represents an exciting new growth opportunity for Altria said Howard Willard Altria's chairman and chief executive officer. We believe that Kronos groups excellent management team has built capabilities necessary to complete to compete Globally and we look forward to helping Kronos group realize its Significant growth potential now. I'm not gonna read all of this for you But I want to read the key points. What are the benefits of the transaction? It will accelerate Kronos groups pace of growth and expansion BAM bolsters Kronos groups ability to be an innovation leader in the cannabis industry BAM Leverages Altria's product design Manufacturing marketing and distribution capabilities and expertise BAM Provides expertise in successful navigating complex regulatory landscapes BAM raises capital at a premium valuation and Delivers even greater upside opportunities for Kronos group shareholders employees and partners Let me read this under the terms of the agreement Altria has agreed to acquire 146.2 million shares at a price of 1625 per share per share Canadian which if we look at the price Let's see. They made a good deal or not Let's see where it finished. So literally it finished at $17.06 in Canada. So they have already made a good deal. Do you see how the market works? So the price per share represents a 41.5 percent premium to the company's 10-day Volume-weighted average price. So what they are saying is when they made this deal the deal was giving them a Price a premium. They were paying them more 41.5 percent more than what the average 10-day volume trading was Previous to this deal So they bought these shares at a premium Remember that not at a discount, but at a premium the strategic investment combines with Altria's expertise and Complementary capabilities are expected to better position Kronos group for significant growth and value creation With benefits to all of the company stakeholders Including its its holders of shares the shareholders employees and partners This is huge is absolutely huge This is the board recommendation the board of directors of Kronos group after consultation with its legal and financial advisors has unanimously determined that the transaction is in the best interest of Kronos group and is unanimously Recommending that shareholders vote in favor of the transaction The board has received an opinion from its financial advisor Lazard Canada Inc that as of the date thereof and subject to the assumptions qualifications and limitations set Forth therein the consideration to be received by the company pursuant to the transaction is fair from a financial point of view to the company interesting Let's just read this equity investment key transaction terms This is the key transaction terms pursuant to the subscription agreement Altria has agreed to acquire 146.2 million shares and this is what I already talked about at a premium of 16.25 per share, but it's already up and it's now at $17.06 so it was a premium for a few days or a few hours now With the here it is with the premium to the 10-day Moving average of the shares on the TSX on November 30th 2018 that was when the deal was transacted based on that date the last unaffected trading day prior to when Kronos Group publicly disclosed Preliminary discussions with Altria, which I broke to you guys Altria will also receive warrants at closing Entitling it to acquire up to an additional 10% ownership position in the company Exercisable from time to time for a period of four years following closing of an exercise price of Which is again a premium look at why this is such a good deal They're not doing this at a discount. They're doing it at premium So this is giving shareholders Hope and belief that they're gonna make money which they have on this company lots of it Which represents an implied premium of 65? 0.5% to the 10-day VW AP of the shares which is the moving average of the shares on the TSX as of November 30 2018 Which is that $19 share price in Canada Altria's ownership interest in Kronos Group would be approximately 55% Calculated on a non-diluted basis which would give them an ownership position Additionally, the warrants will contain certain anti-diluted dilution provisions So that means that they're not going to be able to just sell all their shares They're gonna have to do it With provisions which is going to be carefully and strategic so that they're not gonna hurt the share price So I'm not gonna get into all of this But this is huge news. This is what really drove the cannabis sector on Friday It's been driving it on Thursday and Friday based on a lot of the rumors on this news What do you think about this news? This is huge news for the sector Enormous news for Kronos Group and shareholders and for anybody that was holding Kronos Group huge last couple days Enormous turnaround for Kronos Group. This is a company that went to the Nasdaq was looking really really positive Has had a really crazy year has been up and down and all around and you can see they've been as high as Wow $19.74 and that was on September 19th They've been as low this year around this time last year. They're actually as low as Wow forward haulers and just recently they were as low as on October 29th. They were at $8.50 Which I will mark here, which was the low low over the last three months and you can see they are currently at $17.06 so I will mark that here so we can really watch what is going to happen from here So remember guys rich TV live is strictly for education entertainment purposes always do your due diligence Always do your research before you invest in anything that we talk about here on rich to be live You can get all the breaking news all the top stock information CBD information Cryptocurrency information you can follow us and contact us all over social media And if you would like to be featured on rich TV live, you can contact me at www.richTVlive.com or you can email me at rich TV live at gmail.com and You can get featured. It's true. Now. I want to know what you guys think about this news this is enormous news and The stock has responded accordingly chrono's group has done extremely well based on this news a Billion dollar partner a huge influx of money coming in marketing strategy lawyers Consultants this company is going to be a global leader in cannabis and Altria has made a huge move here What do you think about it? I'd like to know what you guys think comment down below Share this video everywhere smash that like button and if you have not subscribed yet Make sure you subscribe so that anytime we have any breaking news anything that happens We can break it down for you guys. We can make you guys understand What's really going on so that you guys can win if you're not winning you're definitely not watching? This is your boy rich, and I'm out What do you think Altria buys 45% of chrono's group for 2.4 billion in Canadian funds with an option to take a controlling stake so that they will own 55% of chrono's group. It's true. Oh Peace What a day what a day