Constellation Brands has doubled down on the future of legal cannabis.
The global drinks company has already acquired a minority stake in the Ontario, Canada-based Canopy Growth Corporation, a public company that provides medicinal cannabis products. Now, ten months later, Constellation Brands has announced a $4-billion investment in the Canadian company.
“Through this investment, we are selecting Canopy Growth as our exclusive global cannabis partner,” explains Rob Sands, CEO, Constellation Brands. “Over the past year, we’ve come to better understand the cannabis market, the tremendous growth opportunity it presents, and Canopy’s market-leading capabilities in this space. We look forward to supporting Canopy as they extend their recognized global leadership position in the medical and recreational cannabis space.”
This investment — the largest to date in the cannabis space, according to the companies involved — will provide funds for Canopy Growth to build and/or acquire assets with the goal to establish global scale in the nearly 30 countries pursuing a federally permissible medical cannabis program, while also laying the global foundation for new recreational cannabis markets.
Canopy Growth’s Canadian platform does not require additional cannabis cultivation assets, the company says. However, management views other jurisdictions, including the U.S., as strategic priorities requiring significant capital.
“Our business can now make the strategic investments required to accelerate our market position globally,” says Bruce Linton, chairman and co-CEO, Canopy Growth. “Constellation’s concentration of global cannabis activities exclusively through Canopy, coupled with the investment and its expert capabilities in brand-building, marketing, consumer insights and M&A, will be a huge benefit as we look to expand our portfolio in Canada, the United States and emerging cannabis markets around the globe.”
Canopy Growth’s future plans also include pursuing various product formats in all cannabis channels.
Both companies have no plans to sell cannabis products in any market unless it is permissible to do so at all applicable government levels, they say. Which means that Canopy Growth remains committed to not entering the U.S. market in any manner that would break federal laws.
Canopy Growth was founded in 2013. Through its subsidiaries Tweed and Spectrum Cannabis, Canopy Growth has established a global presence in 11 countries, which is driven by product innovation, an intellectual property portfolio, and clinical research programs targeting both human and animal health.