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LEAMINGTON, Ont. — Medical marijuana producer Aphria Inc. says it plans to invest $10 million in a company merging two cannabis brands to target the incoming recreational pot market in Canada.

Aphria (TSX:APH) says it has committed to a $10-million equity investment in the venture merging luxury marijuana brands Ontario-based Tokyo Smoke and British Columbia-based DOJA Cannabis Company, which is expected to be renamed Hiku Brand Co. Ltd.

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The Leamington, Ont.-based marijuana company already holds a stake in TS BrandCo Holdings Inc., known as Tokyo Smoke, and last year signed a licensing agreement to produce and ship cannabis with its branding to medical marijuana patients.

Aphria chief executive Vic Neufeld says the investment marks the company’s first venture into premium British Columbia cannabis as it anticipates that branding will become an important differentiator in the recreational pot market, with legalization expected next year.

DOJA has a production facility in B.C.’s Okanagan Valley and a Culture Cafe information centre in Kelowna, while Tokyo Smoke has six coffee and cannabis accessory shops across Canada and one due to open in Seattle early next year.

Aphria says it is also looking to finalize other agreements, pending the approval of a cannabis sales license for DOJA’s wholly-owned subsidiary, including access to West Coast cannabis and Hiku’s retail locations in provinces where private licenses will be granted.