Constellation Brands invests $3.8 billion in Canopy Growth … but is cannabis-infused beer ethical and healthy?
August 16, 2018
Global drinks company Constellation Brands plans to significantly increase its ownership in Canopy Growth by investing an industry-record 5 billion Canadian dollars ($3.8 billion) to make the marijuana titan its exclusive global partner.
Constellation will acquire 104.5 million shares directly from Canopy Growth for CA$48.60 per share, giving the New York-based company – which owns, distributes and markets 100 beer, wine and spirits brands, including Corona and Robert Mondavi – 38% ownership.
It is also the largest investment in any cannabis company to date and will “immediately” put CA$5 billion in the bank for Ontario-based Canopy after the deal closes, the company said in a statement.
Constellation also will receive 139.7 million new warrants, which, if exercised, would increase its ownership in Canopy to more than 50% and provide at least an additional CA$4.5 billion for the diversified marijuana company.
Canopy said it plans to use the cash to build and acquire key assets to establish global scale in the nearly 30 countries pursuing a federal medical cannabis program. The money will not be invested in additional cannabis cultivation assets in Canada, Canopy said. CEO Bruce Linton called the deal “rocket fuel” for Canopy’s international plans.