The legal weed industry is partnering with two sectors long considered its fiercest competitors, the alcohol and tobacco industries. Some alcohol, tobacco, and pharmaceutical companies have, in the past, lobbied against cannabis legalization.
A Quartz report published last month says, “In 2018, US venture capital investment in cannabis companies topped $900 million. As of March 8, investments were on track to double that in 2019.”
The report assessed that licensed cannabis companies made a record number of mergers and acquisitions in 2018, totaling $15 billion. Alcohol and tobacco companies comprised over a third of those deals.
The granddaddy of all recent mergers, worth $4 billion, saw Constellation Brands team up with Canopy Growth. Constellation makes Svedka vodka and Corona beer. Canopy Growth, a Canadian cannabis cultivator, is not only Canada’s largest pot company, but possibly the world’s largest, to boot. The two companies are working on making new weed-infused drinks.
The second biggest partnership involved Cronos and Altria, a merger valued at $1.4 billion. Cronos, also based in Canada, grows weed and invests in pot companies. Altria is best known for producing Marlboro cigarettes. Together, the two brands are working on refining vaporizer devices, as well as rolling out pre-rolled joints.
The Quartz report noted that pharmaceutical companies are in third place for merging with or acquiring cannabis operations.