Constellation completes $4bn cannabis investmentBy Melita Kiely
Casa Noble Tequila maker Constellation Brands has finalised its CA$5 billion (US$4bn) investment in Canadian cannabis producer Canopy Growth Corporation.
An “overwhelming majority” of Canopy Growth shareholders approved the transaction, which has also been approved by the Canadian government under the Investment Canada Act.
Constellation Brands acquired a minority stake in Canopy Growth last year for US$191 million, at which point the company revealed its plans to create cannabis-infused drinks.
The US$4bn deal – the largest investment in the cannabis industry to date – has increased Constellation’s ownership of Canopy Growth to 38%.
It will enable Canopy Growth to grow its presence in more than 30 countries that are currently pursuing federally permissible medical cannabis programmes, while establishing foundations needed to supply markets that are legalising recreational cannabis use.
“We’re excited to expand our strategic partnership with Canopy Growth and to begin helping them build the global scale needed to win long-term,” said Rob Sands, chief executive officer (CEO), Constellation Brands.
“The global cannabis market presents a significant growth opportunity and Canopy Growth is well positioned to establish a strong leadership position in this fast-evolving category.”
Constellation’s investment in Canopy Growth also includes a restructuring of its board of directors.
Chris Schnarr, the managing director of Lorian Group who sat on Canopy Growth’s board, will move into a senior leadership role overseeing medical and therapeutic research commercialisation.
As such, the Canopy Growth board will welcome the following Constellation members to its board: incoming president and CEO Bill Newlands; executive vice president and chief financial officer David Klein; current Constellation board members former HSNi LLC chief operating officer, Judy Schmeling; and CEO of John Hardy Global Limited Robert Hanson.
Earlier this year, SB explored the potential impact the burgeoning legal recreational cannabis category could have on the spirits.