Constellation Brands, a beer distributor that owns Corona, announced that it has signed an agreement to buy an almost 10 percent stake in Canopy Growth Corporation, the world's largest publicly traded cannabis company.
The deal is expected to approximate C$245 million, representing an ownership interest of 9.9 percent of Canopy, plus warrants that give Constellation the option to purchase an additional ownership interest in the future. The transaction is expected to close during Constellation’s third quarter of fiscal 2018.
Constellation noted that it has no plans to sell any cannabis products in the U.S. or any other market unless or until it is legal at all government levels. Both companies intend to enter into an agreement to exchange knowledge and expertise.
“Canopy Growth has a seasoned leadership team that understands the legal, regulatory and economic landscape for an emerging market that is predicted to become a significant consumer category in the future,” said Rob Sands, president and CEO of Constellation Brands. “Our company’s success is the result of our focus on identifying early stage consumer trends, and this is another step in that direction.”
Founded in 2014, Canopy Growth Corporation is one of the earliest commercial players in Canada’s legal cannabis market. The company owns a collection of diverse brands serving customers in Canada and international markets where medicinal cannabis products are legal.
“We are thrilled to have the backing of such a well-established and respected organization such as Constellation Brands,” said Bruce Linton, chairman and CEO of Canopy Growth Corporation. “We look forward to working with the Constellation Brands team to access their deep knowledge and experience in growing brands as we continue to expand our business.”