The phrase “Big Alcohol” is a bit of misnomer. Businesses involved in the manufacture and sale of beer fall into one of two categories: small and absolutely titanic.
Now, you can add a third category: Titanic brewing companies just recovered from a longstanding booze industry bias against marijuana, who now also have a stake in the marijuana industry.
Let us pivot, before we elaborate.
Most major beer brands are owned by just a tiny handful of companies. Megabrewer Molson Coors, which also owns Milwaukee’s Miller Brands, is one of them.
The company’s headquarters are in Denver, but its spiritual home is in Golden, Colorado. Here, you can find 1,100 people working at its main brewery, the largest single-site brewery in the world. This is a beer town—and it is no place for legal weed. After Colorado legalized marijuana, despite opposition from Pete Coors, the company’s former chairman and a big-time Trump supporter, the local city council banned the sale of recreational cannabis.
This is part of a trend.
From what we understand, cannabis and drinks of many kinds can complement each other quite nicely—the fact that cannabis and hops are in the same plant family, Cannabinacea, and share terpenes, is surely just a coincidence—but one of the most reliable opponents of marijuana legalization has been Big Alcohol.
As hacked emails from the DNC posted on Wikileaks last year revealed, the Wine & Spirits Wholesalers of America tracked the legalization of cannabis as a “key issue.” Along with unions representing police and prison guards, the campaign against California’s 2010 failed legalization effort, Proposition 19, received contributions from the California Beer and Beverage Distributors.
Alcohol interests also gave cash to the (failed) effort last year to defeat the (successful) marijuana legalization campaign in Massachusetts. All this was not for nothing: As The Intercept reported, executives at the Boston Beer Company, brewer of Sam Adams, believed marijuana legalization would “adversely impact the demand” for their raison d’être.
But. If you can’t beat them—and Big Alcohol could not—might as well buy them out.
Flush with cash, Constellation Brewing, which owns Corona beer, Svedka vodka and Robert Mondavi wines, last week announced a $191 million investment in Canopy Growth Corporation, the biggest legal marijuana company in Canada.
For now, Canopy will take care of the cannabis growing and distribution, but with Canada poised to start over-the-counter sales of marijuana to all adults 19 and over next summer, and with shares in Canopy stock doing their best Silicon Valley unicorn impression, the potential is enormous.
Whether or not this means mass-market cannabis-infused alcoholic beverage in the near future doesn’t really matter and is beside the point: Big Alcohol knows a huge opportunity when it sees it, and like a beer company scooping up other beer companies—or makers of wine or liquor—it’s a smart business move.
Although liquor distributors in California pulled a major power play to seize a chunk of that state’s multi-billion dollar cannabis industry (and found themselves later outflanked), for now, Constellation is the only big alcohol-making brand to pivot into weed.
For now. Molson Coors sees all this and may be close to making a similar move, as CEO Mark Hunter told analysts in a conference call last week.
As the Denver Business Journal reported, the company has “a team of people” analyzing the weed world. Which, in other words, means Molson Coors is figuring out just how and when to jump in.
“Obviously, being based here in Colorado, we’re very familiar with cannabis, as it’s been legalized here,” Hunter said, as per the paper. “And clearly this is something that, as the whole legal landscape continues to change, we’re actively working to understand. We have a team of people working on that. We’re looking at potential impacts and/or the opportunities associated with, and we’re developing a range of responses.”
As for when that might be, or what, Hunter stayed mum.
“I think the important thing is to make sure we don’t get caught in some kind of adrenaline rush,” he said. “We’re very thoughtful, very purposed and we’re very clear on how we want to respond to both what could be challenges and what also could be opportunities. So, more to come in due course.”
Is this smart business, or is the alcohol industry hedging bets against a future shift in the intoxicant market? Marijuana legalization’s main selling point in Colorado was that it’s a “safer” alternative to sauce, although so far, it appears consumers are having their weed, and drinking beer, too. One study released after legalization found a legal cannabis market was linked to a rise in drinking.
If that trend holds true, and legalization continues spreading across the continent, Big Alcohol will have every reason to invest in legalization campaigns—and then start buying out every weed brand they can find.