Home Business Constellation Acquires 10% Stake in CANOPY GROWTH CORP (OTCMKTS:TWMJF)

Constellation Acquires 10% Stake in CANOPY GROWTH CORP (OTCMKTS:TWMJF)

SHARE
CANOPY GROWTH CORP (OTCMKTS:TWMJF)
Exultant team of multiracial young business professionals rejoicing and congratulating each other giving a high fives gesture

CANOPY GROWTH CORP

(OTCMKTS:TWMJF)

Shares of CANOPY GROWTH CORP (OTCMKTS:TWMJF) gained 19.2% after Constellation brands agreed to buy a 10% stake in the company. The beer distributor is to pay $191 million in exchange for a 9.9% stake, valuing the company at about $2 billion.

CANOPY GROWTH CORP (OTCMKTS:TWMJF)

TWMJF Investor Reaction

Constellation Brands will pay $12.98 per share to acquire the 10% stake representing a 1.5% premium to last week’s closing price of $12.79 a share. The transaction is set to close in the third quarter of 2018, subject to satisfaction of closing conditions.

Investors reacted to the news by pushing the stock to this year’s high $12.17 a share, before it dropped to end the day at $11.90 a share. Monday’s rally affirmed a strong bullish run that began in June as the stock continues to trade in an uptrend. Canopy Growth Corporation is up by more than 60% for the year as it continues to outperform the overall industry.

Strengthening investor confidence in CANOPY GROWTH CORP (OTCMKTS:TWMJF) does not come as a surprise given that it has grown to become the largest publicly traded cannabis company. A deal with Constellation Brand supports the company’s prospects in the industry and lends credence to its growth metrics.

Constellation Brand Big Plan

Reports indicate that Constellation Brands plans to work with CANOPY GROWTH CORP (OTCMKTS:TWMJF) to develop market and sell cannabis-infused beverages.

“We are thrilled to have the backing of such a well-established and respected organization such as Constellation Brands. We look forward to working with the Constellation Brands team to access their deep knowledge and experience in growing brands as we continue to expand our business,” said Bruce Linton, Chairman, and Chief Executive Officer, Canopy Growth Corporation.

Constellation Brands acquiring stakes in CANOPY GROWTH CORP (OTCMKTS:TWMJF) is part of an effort that seeks to take advantage of the ongoing nationwide marijuana legalization. The legalization drive has helped expand the market, presenting unique opportunities that companies are fighting for given the size of the market.

California may legalize the recreational use of pot next year. Canada may legalize the recreational use of Marijuana starting in July 2018. Constellation Brands plans to start selling its cannabis-infused beverages in countries where recreational use is approved. According to CEO, Rob Sands they will only venture into the U.S market when the plant is legalized nationwide.

I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.

Don’t miss out! Stay informed on $TWMJF and receive breaking news on other hot stocks by signing up for our free newsletter!

LEAVE A REPLY