Successful legalization efforts across USA and Canada have lead major alcohol brands to jump in bed with legal weed companies. And the reason is because Big Alcohol has big plans to corner the North American marijuana beverage market. But after billions of dollars in investments and big claims about combining hops and hash, it appears that the honeymoon phase between two of the biggest booze and bud brands is already over.
According to a new report from Market Watch, William Newlands, the CEO of Constellation Brands, the multinational alcohol company responsible for Corona, Svedka, Modelo, and more, is upset at the poor stock performance of Canopy Growth, the major Canadian cannabis producer with which Constellation has a more than $4 billion investment. And while most CEOs might have kept their internal displeasure under wraps, Newlands has not been shy about his displeasure with Canopy’s recently released fourth quarter stock stats.
“While we remain happy with our investment in the cannabis space and its long-term potential, we were not pleased with Canopy’s recent reported year-end results,” Newlands told Constellation stakeholders in an investor conference call late last week. “However, we continue to aggressively support Canopy on a more focused long-term strategy to win markets and form factors that matter, while paying a clear path to profitability.”
During the conference call, Newlands told Constellation investors that the alcohol magnate had incurred some $106 million in losses thanks to Canopy’s poor stock showing. On a whole, though, that hundred million dollars equates to less than 3 percent of Constellation’s total investment in Canopy.
As Canada prepared to roll out legal cannabis sales in 2018, alcohol brands from around the world flocked to the Great White North for a piece of the pie. And among brands like Molson-Coors and corporate bigwigs from Budweiser and Blue Moon ditching booze for bud, Constellation’s multibillion dollar stake in Canopy has been the largest and most significant financial mingling of the two vice industries.
The two brands are still in the research and development phase of their plans to produce cannabis-infused non-alcoholic beverages, but with a fire lit under the partnership by Newlands recent comments, we’re guessing that a prototype pot lager is on the way sooner than later.
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