Aphria gained as much as 17 percent, retracing some of its losses this week, although the stock is still poised to end the week at its lowest price since November 2017.
The transaction is expected to finalize within the first half of 2019.
Altria's stock has fallen almost 25% this year and the company is expected to report revenue growth of only about 1% this year and in 2019.
Last summer, Tilray Inc., a medical marijuana company in British Columbia, became the first marijuana business to complete an initial public offering on a major USA stock exchange, raising $153 million to expand its operations as Canada prepared to legalize the drug nationwide.
While the beverage giant has yet to announce any formal partnership, Bloomberg reported last September that Coca-Cola was in advanced talks on a deal with Aurora Cannabis, another Canada-based firm. Federal data from November showed cigarette smoking among US adults reached an estimated 14 per cent in 2017, the lowest level ever.
Philip Morris International CEO Andre' Calantzopoulos discusses why his company is keeping clear of the cannabis industry. Canopy Growth (CGC) was up 2.6%. Doing so would lift Altria's status to a majority shareholder as it would own around 55 percent of the company.
"As one of the largest companies in the adult consumer products sector, Altria has 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", Cronos said in its press release. Molson Coors Canada owns a 57.5 percent interest in the joint venture.
Altria agreed to acquire 146.2 million newly issued shares for C$16.25 each - a 16% premium from yesterday's close.
Altria's huge investment lit up shares of cannabis companies that have begun to set up shop in Canada, where recreational use was legalized this year.
"Altria is the ideal partner for Cronos Group, providing the resources and expertise we need to meaningfully accelerate our strategic growth", Mike Gorenstein, Cronos's chairman and chief executive officer said in a statement.