Beer Company Banks A Cool $4B On Marijuana
Corona & cannabis have one similar thread for me; if I have too much of either I want to spend an obscene amount of money ($15 – $25) on late nite Taco Bell. And now, they’ll have even more in common. In what’s being called the biggest investment in the marijuana industry yet, Corona’s parent company Constellation Inc. has invested almost $4 billion in Canadian producer ‘Canopy Growth’. Here are a few of the brands you might recognize under the Constellation umbrella:
Beer:
Corona
Modelo
Pacifico
Ballast Point
Wines:
Robert Mondavi
Arbor Mist
My beloved Cook’s champagne
Spirits:
Black Velvet whisky (oh God)
Svedka vodka
Coming soon, probably:
Electric Lettuce
Satan’s Cabbage
Frankenstein
The Incredible Hulk
Northern Lights
Maui Wowie
Alabama Kush
Canopy Growth Corps’s (NYSE: CGC) stock soared 30% with the news, and the goal of the partnership for Constellation is to expand & accelerate CGC around the globe in both medical & recreational markets. (And to make an insane butt-load of money doing so.) At first I figured this was just a smart move to deal with growing demand as more locales legalize, but it could also be a sign there’s trouble brewing in the beer biz:
What does a beer company do to hedge against slowing growth in its main business? In the case of the parent company of Corona, the answer is to invest heavily in the marijuana industry.
The research firm Euromonitor estimates that the American market for legal marijuana products will reach $20 billion by 2020, up from $5.4 billion in 2015.
So far Heineken and Molson Coors have moved to sell cannabis-infused drinks. Heineken’s Lagunitas brand has started selling nonalcoholic sparkling water featuring THC, the active component of marijuana. And Molson Coors has formed a joint venture with Hydropothecary, a weed producer, to make cannabis-infused beverages.
A deal like this is miles away from ordinary?… (No? Ok.) And as for the U.S. beer industry slowing – it’s Friday. Please do your part to help these poor lil guys out.