Alcohol giant Constellation Brands, the $42 billion company that owns Corona, Modelo, and Svedka has bought a 9.9 percent minority stake in the $2 billion Canadian medical cannabis company Canopy Growth. The stake is worth $191 million, with the option to increase in the future.
Constellation’s CEO confirmed that this investment is part of a move to develop marijuana-infused beverages using their own prowess in the beverage industry and Canopy’s cannabis expertise. This would be the first product of its kind, opening up a major market for marijuana as alcohol sales continually decline.
In buying this stake, Constellation is predicting that marijuana will be legal across the U.S. sooner than we may think, but the company has no intention of selling marijuana until it’s legal at “all government levels.” They may be selling products in Canada as soon as 2019, when legalization of edible and drinkable cannabis products is expected to pass.
“This looks a lot like the new normal,” Canopy CEO Bruce Linton told the Chicago Tribune. “There’s no need to include alcohol [with these products], nor is there an intent to include alcohol in how we follow through with things.” While marijuana still remains illegal in the majority of U.S. states, polls have shown that 64 percent of Americans want the cannabis ban lifted.
Until then, Constellation will have to tread very carefully in the U.S., strictly selling in states where recreational marijuana has been legalized until federal legislation is passed.