A U.S. alcohol giant’s decision to buy a stake in Canopy Growth Corp., Canada’s largest cannabis producer, sent marijuana stocks sharply higher on Monday and is expected to spur more cross-industry combinations as well as lure a new class of investors to the emerging industry.
Constellation Brands, a U.S.-based booze distributor behind brands such as Corona beer, Kim Crawford wine and Casa Noble Tequila, is buying a near 10-per-cent stake in Canopy for $245-million. The agreement also includes a plan to together develop and market cannabis-based beverages for adults in markets, where legal.
The deal is considered the first of its kind in the cannabis sector, which helped to drive up shares of Canopy and other pot stocks on Monday. Canopy shares closed up 19 per cent, while other large producers such as Aphria Inc. and Aurora Cannabis Inc., finished the day up 8 per cent and 5 per cent, respectively. The Horizons Marijuana Life Sciences Index ETF, Canada’s first cannabis ETF, was up 5 per cent.
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Brenda Bouw – Globe and Mail – October 30, 2017.
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