This investment is complementary to other recent investments made by the group, most notably the strategic R&D collaboration established with Canada’s Organigram Holdings Inc. announced in March of last year.
The stake in Sanity Group adds a European dimension to the group's 'portfolio beyond nicotine', it said.
Sanity Group Background
Sanity Group, which is based in Berlin, offers a portfolio of CBD consumer brands and medical cannabis brands.
It also has a proven track record in the research, development, and marketing of cannabis products.
A draft bill around the legalisation of cannabis in Germany is expected within the second half of 2022.
The country's coalition government, led by Olaf Scholz, pledged to legalise cannabis for recreational use in its 2021 coalition deal.
Kingsley Wheaton, chief growth officer at BAT, said, "Investing in Sanity Group is another example of BAT's ongoing work to explore numerous areas beyond nicotine, positioning BAT for future portfolio growth across a range of categories and geographies.
"We continue to transform our business, through better understanding of our current and future consumers, as part of our A Better Tomorrow purpose."
Elsewhere, the tobacco giant recently said a year-long study evaluating the potential harm reduction of using heated tobacco products compared to cigarettes will help expand the category of alternative 'smoke-free' products.