RE:News FlashThe marijuana biz got a lot of attention when some of the players got 200 baggers on their shareprice.
Everybody and their fool rushed in to be a part of it.
Good news for government because it drove the price of safe, inspected pot down to black market price and made it near impossible for anybody to make any money.
Until this right-sizes, it will continue this way imho.
The fact that the policy and law makers are dragging their feet on fixing what they did wrong for bona fide players to make any money has resulted in a leading Canadian LP to take drastic steps like moving operations to the US where there is a possiility of getting a return on investment.
Since Constellation stepped onto the scene Canopy was a dream come true that they saw something in to plunk down $5 Billion to put themselves in the drivers seat. That woke up all of the others and a lot of the players had a good run, not based on any kind of accounting measurement but more on irrational exuberance.
That is one of the amazing things about the herding instinct is that sheeples follow sheeples.
Too much competition, too many players and that brings us to where we are with today's nr that has spelled out some serious solutions to save the leading LP.
Originally Canopy built a company that was everything marijuana and hemp and a lot of those skus were destined to fail or be outgunned by competition.
Canada legalized and strangled the cannabinoid business with some very poor thought out packaging, sizing, delivery skus that didn't fit into Canopy's wheelhouse which focused on beverages. Beverages containing cannabinoids showed huge promise and Constellation joined forces because they saw lost marketshare to this type of infused beverage hurting their soft alcohol sales. They had $5 billion worth of conviction that didn't stop there because they continued on to the bigger plan by securing deals with a half dozen US like-minded companies that were well chosen because they were showing positive potential.
Constellation has announced that they are cutting losses in Canada and putting their effort to all of those US companies to incorporate together under an umbrella called CGC USA division or some other new listing. They think they can pull this off and it has a lot of moving parts and will need more than just shareholder approval but also a great degree of government co-operation.
We got a big dose of the pain required to stop the drain in Canada and it will continue until we succeed or fail.
The big question is how are the existing shareholders of all of these different companies going to fare after bringing all of these assets together.
Commonsense tells me that this is going to be formidable as a huge competitive entity that will be hard to compete with but totally dependant on the management and the sense of security that shareholders get while this comes together.
I;m sure that a lot of investors here are oblivious to the investments that Constellation has made with this big picture story in mind. Will they continue to support this investment strategy until it has a fair chance of being successful?
I think yes!
If US MSOs are able to show black ink, Constellation should be able to also, if we can get past the huge attrition that is coming as the underfinanced fail.
The US politiicans could do a lot to fix this for what these brave new potpreneurs need to be successful. They have willing legal players that are telling them what they need and that also included reigning in the black market potpreneurs that don't have licensing, overhead expenses that the legit players do.
I am still a believer that Canopy/Constellation can lead the way if the politicians quit tossing this around like a political football and get it finished, like Joe said, repeatedly for all of the other unfinished projects on his to-do list.
The majority are ok with a new legal vice.
glta and dyodd