Big business is moving in on the legalization market. Cannabis conspiracy theorists across the nation are congratulating themselves for having gotten something right, and maybe prohibitionist Kevin Sabet is feeling justified (even though he’s clearly on the wrong side of history).
Whether it’s a good or bad thing, the new move is a reflection of capitalist inevitability. Yes, legalization is going to bring in outside players with a lot of money. And if we claim we want to regulate cannabis like alcohol, then we have to expect the alcohol industry to be involved.
In the United States, that’s still impossible. Federal prohibition ties the hands of alcohol industry explicitly from being associated with any illegal substance, which is why there is such a struggle in the entertainment industry when it comes to cannabis-based events: alcohol is not allowed.
But that’s not the story in Canada. Our neighbors to the north have moved forward with a state-regulated system for adult production and sales, leaving large and international investment opportunities open.
This weekend, Constellation Brands, a major alcohol distributor based in the United States which includes the widely ubiquitous Corona beer, has just purchased 9.9% of the Canopy Growth Corporation, with an option to purchase up to 20% total, to the tune of $245 million Canadian dollars ($191 million US).
Constellation Brands President and CEO, Rob Sands, indicated the group is hedging their bets on a legal US market in the not-too-distant future, and stated they would not be selling any cannabis products in the US until federal prohibition was lifted.
“Constellation Brands is a listed on the S&P 500 and posted record net sales of $7.3 billion for its fiscal 2017 results.
“Canopy Growth is the world’s largest publicly traded cannabis company, with a market valuation of 2.2 billion Canadian dollars. It is listed on the Toronto Stock Exchange.
“Constellation said the transaction is expected to close during the Company’s third quarter of fiscal 2018.”
As of this morning, Reuters reported a surge of more than 16 percent for Canopy Growth Corp stocks on the Toronto Stock Exchange’s S&P/TSX. With the momentum clearly behind marijuana legalization, it is safe to say that this won’t be the last big mainstream business that invests in the cannabis industry.
If you want to compete in the cannabis market, you have to stay informed! The International Cannabis Business Conference has you covered. Join us December 1-3 in Kauai, Hawaii, in February in San Francisco, in April in Berlin, and next June in Vancouver, Canada! If you are in the Oregon cannabis industry, or thinking of joining, then you should definitely attend the Oregon Marijuana Business Conference in Ashland on November 18-19.