TORONTO, May 23, 2017 /CNW/ - Cronos Group Inc. (TSXV:MJN) ("Cronos" or the "Company") is pleased to announce the Company's wholly-owned licensed producer ("LP"), the Peace Naturals Project Inc. ("Peace"), breaks ground today on a 315,000 sq. ft. expansion. The expansion includes a state-of-the-art 286,000 sq. ft. production facility (the "New Facility"), a 28,000 sq. ft. greenhouse (the "Greenhouse"), and an additional 1,200 sq. ft. extraction laboratory (the "Extraction Lab"). Upon completion, the New Facility is expected to be the largest purpose-built indoor cannabis production facility in the world.

This expansion will establish the Peace production campus as Cronos' global center of excellence. The New Facility is designed to Good Manufacturing Practice ("GMP") certification standards and will include:

Designated area for proprietary genetic breeding

Pharmaceutical laboratory for cannabinoid and terpene extraction, identification, and formulation

R&D space for analyzing metabolite enhancement and new lighting technologies

Tissue culture laboratory

Industrial-grade kitchen

Processing infrastructure capable of supporting production output from other Cronos facilities

The superstructure is expected to be complete by November 2017, with the New Facility fully operational by summer 2018. This expansion will bring Peace's total estimated production capacity to 40,000 KG on an annualized basis.

"Over the past six months, we've compiled research on numerous methodologies, ultimately culminating in a state-of-the-art facility that integrates lean manufacturing, production efficiencies, and commercial agricultural best practices. As an organization, we take a relentless approach to operational optimization," said David Hsu.

The Company also breaks ground today on a 28,000 sq. ft. Greenhouse that will provide low-cost flower for extraction. The Greenhouse will be used to collect data and implement advanced cultivation techniques that can be replicated across Peace, ITZ and future international production campuses.

A 1,200 sq. ft. pharmaceutical-grade Extraction Lab will be connected to the Greenhouse, expanding Peace's current extraction capacity. The Extraction Lab will augment capabilities in both purification and recombination of cannabinoid compounds to create innovative formulated products. Completion of both the Greenhouse and Extraction Lab are expected by the end of summer 2017.

"The New Facility will serve as Cronos' center of excellence, providing a platform for top plant scientists, chemists and pharmacologists to advance the science of cannabis. With the ability to build approximately 5,000,000 sq. ft. of facilities across our licensed domestic platforms, this is only the first phase of our expansion. We will continue to be aggressive, but disciplined, constantly evaluating new technologies and exploring international low-cost production sites before each phase of expansion. We're excited to bring Peace to the world," said Mike Gorenstein, CEO of Cronos.

About Cronos Group

Cronos Group, is a geographically diversified and vertically integrated cannabis company that operates two wholly-owned Licensed Producers ("LPs") regulated within Health Canada's Access to Cannabis for Medical Purposes Regulations (the "ACMPR") and holds a portfolio of minority investments in other Licensed Producers. The Company's flagship LPs, Peace Naturals Project Inc. (Ontario), and In The Zone Produce Ltd. (British Columbia) are collectively situated on over 125 acres of agricultural land and are currently licensed to produce 2,600 kg of cannabis on an annual basis. Cronos Group is focused on building an international iconic brand portfolio, providing patients with compassionate and personalized care, and creating value for our shareholders.

Forward-looking statements

This news release may contain "forward-looking information" and "forward-looking statements" within the meaning of applicable Canadian securities legislation. All information contained herein that is not clearly historical in nature may constitute forward-looking information. 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. 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. This news release contains information obtained by Cronos Group from third parties. Cronos Group believes such information to be accurate but has not independently verified such information.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

For more information, please visit www.thecronosgroup.com.

SOURCE Cronos Group Inc.

For further information: Michael Krestell, Investor & Media Relations, TEL: 647-274-3655, E-mail: [email protected]