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Pot producer Green Thumb partners with Gwyneth Paltrow-backed beverages brand

By Arunima Kumar

March 3 (Reuters) - Pot producer Green Thumb Industries Inc said it would make and distribute Gwyneth Paltrow-backed CBD-infused sparkling water "Cann" across the U.S, banking on the brand's early success in California and rising demand for cannabis drinks.

Green Thumb, among the largest U.S. cannabis companies by market value, said on Wednesday it would begin distributing Cann in Illinois this spring and later expand to additional markets, including New Jersey, which recently legalized recreational marijuana.

Top cannabis operators across North America are trying to establish early dominance in the drinks market, a product considered to be more socially accepted than smoking is.

"It's the easiest kind of way to see new users enter the space ... much easier for me to share a drink with my mother than to share a joint," Ben Kovler, Green Thumb's chief executive officer told Reuters.

Sales of cannabis-infused beverages were up 40% last year, according to data from Headset, used widely by industry analysts.

Cannabis companies are also betting that there is room for significant growth ahead, as leading U.S. Democrats lend support to laws allowing easier banking access, decriminalization of marijuana and other favorable changes.

Green Thumb's deal with Cann comes just days after the world's most highly valued pot producer, Canopy Growth , launched its own CBD-infused sparkling water line in the U.S.

Cann, which is backed by notable celebrity investors, including Gwyneth Paltrow and Baron Davis, makes beverages infused with micro-doses of CBD and tetrahydrocannabinol (THC) extract designed to be similar in strength to a glass of wine or a light beer.

Green Thumb may launch its own cannabis beverage brand in the future, Kovler told Reuters, adding that it was not in the works right now.

(Reporting by Arunima Kumar in Bengaluru; Editing by Amy Caren Daniel)