Image copyright Getty Images Image caption There are nearly 30 countries pursuing a federally permissible medical cannabis programme

Corona beer owner Constellation Brands is set to pour some $4bn (£3.15bn) into Canada's top cannabis producer, Canopy Growth, in a deal marking the largest investment in the industry to date.

Last year, Constellation injected $200m into Canopy in a deal to produce a non-alcoholic cannabis-based beverage.

The alcohol firm wants to capitalise on the growing legalisation of the drug.

On news of the deal, Canopy's Toronto-listed stock surged 30%, while on Wall Street, Constellation's fell 6%.

The two firms said the investment would allow Canopy to expand its business reach "in the nearly 30 countries pursuing a federally permissible medical cannabis programme".

Canopy, which has the largest legal cannabis production footprint in the world, currently produces cannabis-based oils and soft gel caps, among other products.

With Constellation's latest injection of cash, Canopy plans to expand its suite of products to include edible bars, inhalers and pre-rolled items.

It also wants to develop cannabinoid-based medicines that provide a safer alternative to some mainstream treatments for pain, anxiety, sleeplessness and psoriasis.

"This [deal] marks the end of the warm-up in our sector... it's fully go-time," said Canopy's chief executive Bruce Linton on an investment call.

'Tremendous growth opportunity'

Constellation, which makes and markets beer, wine and spirits in the US, Canada, Mexico, New Zealand and Italy, noted that governments around the world had already signalled a significant change in attitudes towards cannabis and cannabis-based products.

"Over the past year, we've come to better understand the cannabis market, the tremendous growth opportunity it presents, and Canopy's market-leading capabilities in this space," said Rob Sands, chief executive of Constellation Brands.

In June, the Canadian government passed a bill which will effectively legalise the recreational cannabis market in the country. The bill is set to be rolled out in October.

Constellation's latest investment in Canopy takes its ownership in the firm to 38%.

The deal is subject to regulatory approval and is expected to be closed no earlier than the end of October.</s>Constellation Brands (NYSE:STZ) and Canopy Growth (NYSE:CGC) announce an expansion of their strategic partnership.

Under the terms of the new arrangement, Constellation will increase its ownership interest in Canopy Growth by acquiring 104.5M shares directly from Canopy Growth. The investment by Constellation will take its ownership interest in Canopy Growth to ~38% when assuming exercise of the existing Constellation warrants.

Constellation Brands is acquiring the new shares at a price of C$48.60 per share.

Constellation will also receive additional warrants of Canopy that, if exercised, would provide for at least an additional C$4.5B to Canopy Growth.

"Through this investment, we are selecting Canopy Growth as our exclusive global cannabis partner," says Constellation CEO Rob Sands.</s>VICTOR, N.Y. and SMITHS FALLS, Ontario, Aug. 15, 2018 (GLOBE NEWSWIRE) -- Constellation Brands (NYSE: STZ and STZ.B), a leading beverage alcohol company, and Canopy Growth Corporation (Canopy Growth) (TSX: WEED, NYSE: CGC), a leading diversified cannabis company (together, the "Companies"), today announced a significant expansion of their strategic partnership to position Canopy Growth as the global leader in cannabis production, branding, intellectual property and retailing.



Constellation Brands will increase its ownership interest in Canopy Growth by acquiring 104.5 million shares directly from Canopy Growth, thereby achieving approximately 38 percent ownership when assuming exercise of the existing Constellation warrants. Constellation Brands is acquiring the new shares at a price of C$48.60 per share, which is a 37.9 percent premium to Canopy's 5-day volume weighted average price of the common shares on the Toronto Stock Exchange ("VWAP"), and a 51.2 percent premium to the closing price on August 14, 2018. Constellation will also receive additional warrants of Canopy that, if exercised, would provide for at least an additional $4.5 billion CAD to Canopy Growth.



As a result of the new shares Constellation is acquiring, Canopy Growth will immediately upon closing have proceeds of approximately $5 billion CAD ($4 billion USD) to bolster its leadership position in the global cannabis industry. This investment, the largest to date in the cannabis space, will provide funds which Canopy Growth will deploy to strategically build and/or acquire key assets needed to establish global scale in the nearly 30 countries pursuing a federally permissible medical cannabis program, while also rapidly laying the global foundation needed for new recreational cannabis markets. Canopy Growth's Canadian platform does not require additional cannabis cultivation assets, and management views other jurisdictions, including the United States, as strategic priorities requiring significant capital.



"Through this investment, we are selecting Canopy Growth as our exclusive global cannabis partner," said Rob Sands, Chief Executive Officer, Constellation Brands. "Over the past year, we've come to better understand the cannabis market, the tremendous growth opportunity it presents, and Canopy's market-leading capabilities in this space. We look forward to supporting Canopy as they extend their recognized global leadership position in the medical and recreational cannabis space."



Canopy Growth will benefit from Constellation's deep understanding of consumer trends and shifting preferences, and proven ability to translate those insights into distinct brand positionings that build strong connections with consumers and foster brand loyalty. Constellation's disciplined approach and capabilities in areas such as mergers and acquisitions, finance, large-scale production, marketing and sales as a leading Fortune 500 company, combined with Canopy's entrepreneurial approach and best-in-class knowledge and expertise within the emerging cannabis sector create a powerful combination that will ensure Canopy Growth is set up for sustainable, long-term success as the company and sector evolve.



Founded in 2013, Canopy Growth has cemented itself as the industry leader in Canada's legal cannabis market. Through its subsidiaries Tweed and Spectrum Cannabis, Canopy Growth has established a global presence in 11 countries which is driven by product innovation, a robust intellectual property portfolio, and clinical research programs targeting both human and animal health. In Canada, Canopy Growth has established sophisticated operations to support recreational sales by raising capital and making the strategic investments required to maintain and accelerate its market leadership position at a critical time in the company's evolution. Substantial capital is required to fully capitalize on Canopy Growth's market-leading position in Canada and establish similar leading positions in markets around the globe.



"Our business can now make the strategic investments required to accelerate our market position globally," said Bruce Linton, Chairman and Co-CEO, Canopy Growth. "Constellation's concentration of global cannabis activities exclusively through Canopy, coupled with the investment and its expert capabilities in brand-building, marketing, consumer insights and M&A will be a huge benefit as we look to expand our portfolio in Canada, the United States and emerging cannabis markets around the globe. We view this investment in our business as an endorsement of our execution since forming our initial strategic relationship in October 2017."



As part of the proposed transaction, Constellation will nominate four directors to Canopy Growth's seven-member Board of Directors, Chaired by Founder Bruce Linton. Canopy Growth will remain a proudly Canadian publicly-traded company headquartered in Smiths Falls, Ontario, Canada and will continue to be led by its existing management team, who will continue to manage all international cannabis operations.



As part of its investment, Constellation is receiving 139.7 million new warrants which are exercisable over the next 3 years. Of those, 88.5 million are exercisable at a price per share of C$50.40, a 43.0 percent premium to Canopy's VWAP, and 51.3 million are exercisable at the VWAP at the time of exercise. If Constellation were to exercise all existing and new warrants, its ownership would exceed 50 percent.



Canopy Growth's future plans include pursuing various product formats in all cannabis channels. Both companies have no plans to sell cannabis products in any market unless it is permissible to do so at all applicable government levels. Canopy Growth remains committed to not entering the U.S. market in any manner that would contravene U.S. federal laws.



Constellation expects to account for its investment under the equity accounting method. As such, the transaction is expected to be accretive to the company's full year diluted earnings per share in fiscal 2021. In addition, Constellation Brands remains committed to its investment grade rating and therefore, has no plans to engage in mergers, acquisitions or share repurchase activity until the company returns to its 3.5x leverage target, which is expected to occur within 18-24 months of deal closing.



The transaction is subject to customary closing conditions, including Canopy shareholder approval and applicable Canadian government and regulatory approvals, and is expected to close by the end of October 2018. Goldman Sachs advised Constellation Brands and Bank of America Merrill Lynch is providing committed financing for this transaction. Greenhill & Co. Canada Ltd. acted as exclusive financial advisor to Canopy Growth. Kingsdale Advisors is acting as strategic shareholder communications advisor and proxy solicitation agent to Canopy Growth.



Canopy Growth Chairman and Co-CEO Bruce Linton and Constellation Brands CEO Rob Sands will provide further commentary on this expanded partnership at the beginning of Canopy Growth's earnings call to be held today at 8am Eastern Time.

Replay Information:

A replay of the call will be accessible by telephone until 11:59 PM ET on November 13, 2018.

Toll Free Dial-in Number: 1-855-859-2056

Replay Password: 4984819



Constellation Brands (NYSE: STZ and STZ.B), a Fortune 500 company, is a leading international producer and marketer of beer, wine and spirits with operations in the U.S., Mexico, New Zealand, Italy and Canada. Constellation is the No. 3 beer company in the U.S. with high-end, iconic imported brands such as Corona Extra, Corona Light, Modelo Especial, Modelo Negra and Pacifico. The company's beer portfolio also includes Ballast Point, one of the most awarded craft brewers in the U.S., and Funky Buddha Brewery. In addition, Constellation is the world leader in premium wine, selling great brands that people love, including Robert Mondavi, Clos du Bois, Kim Crawford, Meiomi, Mark West, Black Box, Ruffino and The Prisoner. The company's premium spirits brands include SVEDKA Vodka, Casa Noble Tequila and High West Whiskey.



Based in Victor, N.Y., the company believes that industry leadership involves a commitment to brand building, our trade partners, the environment, our investors and to consumers around the world who choose our products when celebrating big moments or enjoying quiet ones. Founded in 1945, Constellation has grown to become a significant player in the beverage alcohol industry with more than 100 brands in its portfolio; about 40 wineries, breweries and distilleries; and approximately 10,000 talented employees. We express our company vision: to elevate life with every glass raised. To learn more, follow us on Twitter @cbrands and visit www.cbrands.com.



This news release contains forward-looking statements. All statements other than statements of historical fact are forward-looking statements. The words "expect," "intend" and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. These statements may relate to business strategy, future operations, prospects, plans and objectives of management, as well as information concerning expected actions of third parties. All forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those set forth in, or implied by, such forward-looking statements. The forward-looking statements are based on management's current expectations and should not be construed in any manner as a guarantee that such results will in fact occur or will occur on the timetable contemplated hereby. Examples of such statements include but are not limited to the timing and completion of the proposed transaction, shareholder approval, and applicable government and regulatory approvals of the proposed transaction, anticipated use of proceeds, exercise by Constellation Brands of any warrants, expected accounting method, future expansion efforts, the leadership of Canopy Growth in the cannabis industry, the impact of the transaction on Canopy Growth's market position, the composition of Canopy Growth's management team, the location of Canopy Growth's headquarters, future operational and production capacity and requirements, the impact of any enhanced infrastructure and production capabilities, future success and anticipated available product selection. All forward-looking statements speak only as of the date of this news release and neither Constellation Brands nor Canopy Growth undertakes any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. In addition to risks and uncertainties associated with ordinary business operations, the forward-looking statements contained in this news release are subject to other risks and uncertainties, including completion of the announced transaction; the accuracy of all projections; the exact elements of Constellation Brands' permanent financing will depend upon market conditions; Constellation's ability to achieve expected and target debt leverage ratios and the timeframe in which the debt leverage ratio will be achieved will depend upon actual financial performance; circumstances may warrant that Canopy Growth use the proceeds from the transaction for different purposes than stated above; the expected benefits of the transaction may not materialize in the manner or timeframe expected, or at all; and other factors and uncertainties disclosed from time-to-time in Constellation Brands, Inc.'s filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the fiscal year ended February 28, 2018 or in Canopy Growth's filings with the Canadian Securities Administration or with the United States Securities Exchange Commission, including its annual information form dated June 28, 2018, which could cause actual future performance to differ from current expectations.</s>Constellation Brands Inc said on Wednesday it would invest US$4 billion (CUS$5.24 billion) more in Canopy Growth Corp , raising its stake in the Canadian marijuana producer to 38 percent.

REUTERS: Corona beer maker Constellation Brands will invest a further US$4 billion in Canada's top cannabis producer Canopy Growth , doubling down on one of a growing number of bets by the alcohol industry in legal pot.

Constellation was among the first major alcohol producers to invest in marijuana production when it pumped nearly US$200 million into Canopy last year but the latest announcement makes it by far the biggest investment in the industry.

Canada, where 4.4 million people reported using the drug in the first half of the year, will fully legalize the recreational use of cannabis in October.

Constellation, Molson Coors and Anheuser-Busch are all using the move by the United States' northern neighbor to hedge their bets for the future at a time when beer sales, roughly 60 percent of Constellation's business, are stagnating, particularly with younger Americans.

Constellation will buy 104.5 million Canopy shares at CUS$48.60 per share, a 51.2 percent premium to the stock's Tuesday closing price.

The deal will take Constellation's ownership in Canopy to 38 percent from the 10 percent it took last October. Constellation could also increase its ownership to over 50 percent if it exercises warrants received as part of the deal.

"Over the past year, we've come to better understand the cannabis market, the tremendous growth opportunity it presents, and Canopy's market-leading capabilities in this space," Constellation Chief Executive Rob Sands said in a statement.

Recreational use is also currently permitted in nine U.S. states and the District of Columbia, and sales in U.S. legal markets should nearly triple to US$16 billion by 2020 from US$5.4 billion in 2015, according to Euromonitor International.

Operating nationwide, however, is more problematic, and Constellation said neither company plans to sell cannabis products in the United States until it is allowed to do so at all government levels.

Other alcohol companies are also eyeing the weed market. Molson Coors Brewing earlier this month said its Canadian arm would make cannabis-infused drinks with Hydropothecary Corp .

U.S.-listed shares of Canopy Growth , whose brands include Tweed and Bedrocan, jumped about 37 percent to US$36.20 in heavy premarket trading. Canopy had a market value of CUS$7.1 billion (US$5.4 billion) as of Tuesday.

Constellation expects the investment in Canopy to add to earnings in 2021. The deal is expected to close in October.</s>SMITH FALLS, Ont. – Constellation Brands has signed a deal to invest $5 billion in Canopy Growth Corp. to increase its stake in the marijuana company to 38 per cent.

Under the agreement, Constellation will acquire 104.5 million Canopy shares at a price of $48.60 per share.

READ MORE: Ontario government still working out details on rules for new marijuana plan

Canopy shares closed at $32.15 on the Toronto Stock Exchange on Tuesday.

Under the deal, Constellation will nominate four directors to Canopy Growth’s seven-member board of directors.

READ MORE: Plants, edibles and drinks, oh my: Smiths Falls’ Canopy Growth inks deal with alcoholic beverage company

Constellation is also receiving 139.7 million new warrants which are exercisable over the next three years.

If Constellation exercises all of its existing and new warrants, its ownership in Canopy would exceed 50 per cent.</s>SMITH FALLS, Ont. -- Constellation Brands has signed a deal to invest $5 billion in Canopy Growth Corp. to increase its stake in the marijuana company to 38 per cent and make it its exclusive global cannabis partner.

Under the agreement, Constellation, a global producer of beer, wine and spirits, will acquire 104.5 million Canopy shares at a price of $48.60 per share.

Canopy shares closed at $32.15 on the Toronto Stock Exchange on Tuesday.

"Over the past year, we've come to better understand the cannabis market, the tremendous growth opportunity it presents, and Canopy's market-leading capabilities in this space," Constellation Brands chief executive Rob Sands said in a statement.

"We look forward to supporting Canopy as they extend their recognized global leadership position in the medical and recreational cannabis space."

The investment follows a deal last year that saw Constellation acquire a nearly 10 per cent stake in Canopy for $245 million.

The agreement Wednesday will see Constellation nominate four directors to Canopy Growth's seven-member board of directors.

Constellation is also receiving 139.7 million new warrants, which are exercisable over the next three years. If Constellation exercises all of its existing and new warrants, its ownership in Canopy would exceed 50 per cent.

"Our business can now make the strategic investments required to accelerate our market position globally," Canopy chairman and co-chief executive Bruce Linton said in a statement.

"Constellation's concentration of global cannabis activities exclusively through Canopy, coupled with the investment and its expert capabilities in brand-building, marketing, consumer insights and M&A will be a huge benefit as we look to expand our portfolio in Canada, the United States and emerging cannabis markets around the globe."

The investment, which is expected to close by the end of October, is subject to customary closing conditions, including Canopy shareholder approval and regulatory approvals.

The investment deal came as Canopy reported a loss of $80.3 million or 40 cents per share for the quarter ended June 30 as it continued to ramp up its operations ahead of the legalization of recreational marijuana in Canada later this year.

The loss compared with a loss of nearly $9.1 million or six cents per share a year ago.

Revenue for the three-month period totalled $25.9 million, up from nearly $15.9 million in the same quarter a year earlier.</s>The U.S. beer industry has seen better days. Millennials, now the largest generational cohort, don't share their parents' affection for beer, and instead prefer hard spirits or wine. And Big Beer has fared worse than the overall industry, as drinkers are increasingly eschewing mass-market labels like Budweiser, Coors Light, and Bud Light in favor of craft brews.

The shift has weighed on the stocks of major brewers Anheuser Busch InBev and Molson Coors Brewing: Both companies have underperformed the market.

Constellation Brands (NYSE: STZ) has taken a different approach. Last year, the company surprised investors by taking a stake in marijuana company Canopy Growth (NYSE: CGC), and recently doubled down on this investment. Are these the early signs of a major change in direction for the company?

In October, Constellation Brands took a near-10% position in Canopy Growth, paying $191 million for its stake, which valued the company at nearly $2 billion. It was a controversial move, but CEO Rob Sands justified the investment by explaining that the company eventually expected nationwide marijuana legalization.

This month, Sands doubled down on the initial investment, paying $3.88 billion to raise its total stake to 38% -- a premium of over 50% to the prior-day's close on the Toronto Stock Exchange. Constellation receives other benefits from this deal, namely warrants that could increase its ownership stake to 50% and control of the board with four of seven seats.

But it's not a marijuana stock ... yet

While this stake will allow Constellation Brands to better enter a potential growth area, it's not quite a marijuana stock. Investors should understand that this purchase won't have an immediate effect on the broader business. Last quarter, Canopy Growth reported C$25 million ($19 million) in revenue, versus $2 billion for Constellation Brands. Revenue attributable to Constellation Brands' smallest segment, spirits, was $80 million in the quarter.

However, marijuana has the potential to become a major gateway to future returns: Canopy Growth grew revenue 63% year over year, and industry analysts expect the legal marijuana business to grow to $31 billion by 2020. The next tailwind will come from Canopy Growth's home market of Canada, as the country's recently enacted marijuana legalization will take effect in October.

The fourth leg of the business

Although investors were lukewarm on the announcement, particularly when Constellation noted that the acquisition would halt any stock buybacks for the next 18 months, long-term investors should be encouraged by the announcement.

In an interview with CNBC, Sands mentioned it was his goal to make marijuana a "fourth leg of the business" behind beer, wine, and spirits -- this could be a better approach than the plans of other mega brewers to buy up craft brewers, especially now that craft sales are beginning to slow.

Constellation Brands has the assets and logistical wherewithal to immediately become the biggest name in the marijuana market, one that will continue to grow at high rates going forward regardless of whether or not the U.S. legalizes the product.

10 stocks we like better than Constellation BrandsWhen investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has quadrupled the market.*

David and Tom just revealed what they believe are the 10 best stocks for investors to buy right now... and Constellation Brands wasn't one of them! That's right -- they think these 10 stocks are even better buys.

Click here to learn about these picks!

Jamal Carnette, CFA has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Anheuser-Busch InBev NV. The Motley Fool owns shares of Molson Coors Brewing. The Motley Fool has a disclosure policy.</s>Constellation Brands has signed a deal to invest $5 billion in marijuana company Canopy Growth Corp. (Photo by THE CANADIAN PRESS)

SMITH FALLS, Ont. — Constellation Brands has signed a deal to invest $5 billion in Canopy Growth Corp. to increase its stake in the marijuana company to 38 per cent.

Under the agreement, Constellation will acquire 104.5 million Canopy shares at a price of $48.60 per share.

Canopy shares closed at $32.15 on the Toronto Stock Exchange on Tuesday.

Under the deal, Constellation will nominate four directors to Canopy Growth’s seven-member board of directors.

Constellation is also receiving 139.7 million new warrants which are exercisable over the next three years.

If Constellation exercises all of its existing and new warrants, its ownership in Canopy would exceed 50 per cent.</s>TORONTO — Global alcohol giant Constellation Brands will invest $5 billion in Canopy Growth Corp. — the largest strategic investment in the cannabis space to date — which the marijuana producer says will help it scale up and fend off competition from established players in big pharma and booze who are hungrily eyeing the pot industry.

Canopy chief executive Bruce Linton called the infusion of capital “rocket fuel” for the Smiths Falls, Ont.-based licensed producer, enabling it to extend its global reach as more markets legalize cannabis around the world.

Canada will this fall become the second country in the world to legalize marijuana for recreational use, sparking a flurry of activity in the homegrown sector. But in the coming years, Canopy’s competition will be the likes of “big pharma,” and “packaged beverage,” rather than Canadian cannabis companies, Linton told analysts on a conference call Wednesday.

“This about accelerating and getting way further out there before those other big names are in,” Linton said. “Getting our products, staking our claims, having the leverage that we have now and moving up.”

As part of the deal, the global producer of beer, wine and spirits will make Canopy its exclusive global cannabis partner.

Constellation Brands will own 38 per cent of Canopy under the deal, in which it will acquire 104.5 million Canopy shares at a price of $48.60 per share. Canopy shares closed Wednesday’s trading session on the Toronto Stock Exchange at $42.20, up more than 31 per cent.

The investment follows a deal last year that saw the Corona-beer maker acquire a nearly 10 per cent stake in Canopy for $245 million and included collaboration on the development of cannabis-based drinks.

Its chief executive Rob Sands called the deal a “powerful partnership” as markets for cannabis are “opening up much more rapidly than appreciated.”

“This is an extremely exciting time to be part of what could potentially be one of the most significant global growth opportunities for the next decade,” Sands told an investor conference call Wednesday.

The Constellation deal comes as other alcohol companies have also started honing in on the cannabis industry. Earlier this month, Molson Coors Canada entered into a joint venture with the Hydropothecary Corp. to develop non-alcoholic cannabis-infused products. As well, Heineken-owned Lagunitas Brewing Co. recently introduced a cannabis-infused hoppy sparkling water in California.

Constellation’s investment on Wednesday is by far the largest strategic investment seen in the space to date, said Russell Stanley, an analyst with Echelon Wealth Partners in a research note.

“Cannabis is quickly becoming a truly global business… We view the Canopy/Constellation news as further proof that a global market opportunity awaits, with Canadian-listed companies well positioned to participate given their head start and superior access to capital,” he said.

Linton said Wednesday the money would largely be used to position the licensed producer for international expansion opportunities as cannabis becomes legal in new regions. Priority markets include the United States, Europe and Latin America, he added.

“As we look around the world, we’re going to be expanding production, we’re going to be doing more research, we’re going to develop more intellectual property… And we’re going to be way more global,” he told analysts on a conference call.

Canopy’s target acquisition list exceeds $1 billion for international assets and non-cultivation assets in Canada, Linton said. The licensed medical marijuana producer doesn’t intend to acquire any cultivation assets at home, as it is easier to build their own, but would be eyeing domestic assets such as bottling lines, he added.

As part of the partnership, Canopy has a services arrangement with Constellation to use its resources, which would help with a U.S. expansion once permitted, Linton added.

The U.S., where cannabis is legal for medical or recreational use in several states but remains illegal at the federal level, is the “best market” and will become “federally legal sooner than people think,” he said.

“We are going to do everything that is fully federally lawful to be available in a market. And we think there are mechanisms of action that we can take that we’re working through. There will be nothing federally illegal in what we do,” he said.

Constellation will also receive 139.7 million new warrants, which are exercisable over the next three years. If Constellation exercises all of its existing and new warrants, its ownership in Canopy would exceed 50 per cent.

The agreement Wednesday will also see Constellation nominate four directors to Canopy Growth’s seven-member board of directors. The investment, which is expected to close by the end of October, is subject to customary closing conditions, including Canopy shareholder approval and regulatory approvals.

The investment deal came as Canopy reported a loss of $80.3 million or 40 cents per share for the quarter ended June 30 as it continued to ramp up its operations ahead of the legalization of recreational marijuana in Canada later this year.

The loss compared with a loss of nearly $9.1 million or six cents per share a year ago.

Revenue for the three-month period totalled $25.9 million, up from nearly $15.9 million in the same quarter a year earlier.</s>The maker of Corona is betting that consumers want something more than beer and booze.

Constellation Brands is spending $4 billion to boost its stake in cannabis company Canopy Growth. Constellation also owns a big wine business, SVEDKA vodka and Casa Noble tequila.

It first invested in Canopy Growth last year, when it bought a 10% stake. Wednesday’s move upped its holding in Constellation to 38%, and leaves open the option to purchase a majority controlling share of more than 50%.

Shares of Canopy, which trade on both the New York Stock Exchange and Toronto Stock Exchange surged more than 25% on the Constellation news. (Canopy’s TSE ticker is WEED by the way.)

Other publicly traded cannabis companies, such as Cronos and MedMen Enterprises, rallied in the United States and Canada.

Constellation’s stock, however, fell nearly 6% after announcing the investment.

Constellation CEO Rob Sands said during Canopy’s earnings conference call Wednesday morning that it was an extremely exciting time to be in the cannabis business.

“This could potentially be one of the most significant global growth opportunities for the next decade,” Sands said.

Canopy Growth CEO Bruce Linton told CNN’s Richard Quest in an interview Wednesday that the deal gives Canopy more credibility.

As more countries around the world start to legalize marijuana, Constellation may be able to launch more cannabis-based alcoholic beverages. Linton told Quest that a drink with no calories that can help fight depression is a possibility for example.

“Constellation gets it. This is happening globally,” Linton told Quest, adding that Constellation can benefit by being the first to market with cannabis-based drinks while other beer and alcohol companies are still trying to figure out what to do in the market.

Even though the recreational use of marijuana is legal in California, Colorado and Vermont and several other states, it is still a federal crime to purchase and possess marijuana.

But Bonnie Herzog, an analyst with Wells Fargo, said she expects Constellation and Canopy to partner on “drinkable cannabis products given the enormous growth opportunity ahead” globally.

Herzog added “there is an expectation that marijuana will eventually be legalized in the U.S.”

So it may be a matter of when, rather than if, Constellation will be able to sell cannabis beverages in America.

Constellation said it did not have a plan for such a product yet.

Kevin Murphy, CEO of Acreage Holdings, a cannabis producer that has former US House Speaker John Boehner on its board, said in an email to CNNMoney that he expects more beverage companies — and perhaps even Big Pharma firms — to look more closely at developing cannabis products too.

One drugmaker, GW Pharmaceuticals, has a cannabis-based treatment for epilepsy called Epidiolex that was recently approved by the US Food and Drug Administration.
Constellation Brands, the owner of Corona Beer, announces plans to invest in Canadian marijuana producer Canopy Growth.