RE:Constellation Brands moves further away from WEEDConstellation has a lot of strings to pull and shifting the financing back to the public investors for the CUSA deal is hardcore, complicated business that some recognize for what it is while others don't.
At one time I felt that Constellation was segwaying in to the cannabinoid infused beverage business which made good sense because I see a huge future for this new entry to the beverage market that show huge promise to cannibalize beer and soft alcohol beverage skus in favour of minimal sugar and less calories for consumers who should be searching these out.
Constellation's $5 billion C dollar investment was a coup for Canopy and helped to launch the runaway shareprices of a lot of marijuana companies but it turned out to be premature because the law and policy makers that do this kind of legalization stuff, had second thoughts.
Constellation is vending those shares in to CUSA in the hopes of US legalization and will probably get a writeoff for tax purposes because the shareprice has been taken ridiculously low, especiall, after the consolidation castration that reduced shareholders to 10% of the shares they once held.
Constellation management has had their thumb on this their intitial investment of $5 billion C. They have set up deals, shut down product lines and manufacturing lines, interestingly enough, the beverage line despite their research showing that cannabinoid infused are going to eat their lunch as a beer biz.
When you have bought control, you can do what you want and wiping out the value of the companies you are interested in, makes sense. They have successfully done this and it affected most. of not all, of the pot companies.
I follow this stuff hard and have 40 years of investing in stock experience and I have questions about their complicated deals, that aren't deals becasue they left themselves loopholes for renogotiating the deal after the market tanks, or walk away from it.
They should be explaining the Canopy Acreage deal in terms that laymen can understand. For sure, the castration they did to Canopy shareholders is grounds to revist the Acreage deal to gut it one more time because I don't see them honouring the 2 or 3 for 1 Canopy share for the reverse takeover of Acreage which is critical, or something similar, to launch quickly in the US.
Team Klein is steering around this like it is a fresh dogmine and I can't see any approval coming from a US watchdog until this part of the deal is explained or, because Canopy revisited the once worth $4 billion deal between them down to $38 million, can just walk away from the deal and leave Acreage to sink or swim on it's own with no takeover deal that once seemed to be a brilliant deal.
Acreage is the least loved US MSO since Constellation exercised their influence on the deal but got revamped the same way that Canopy did and my understanding is it is leaned out and ready for profit.
It won't help longtime shareholders like me because it was hit just as hard as Canopy when they split the shares in to A and B class and even the old 2 or 3 for 1 Canopy share deal is just another consolidation castration for Acreage shareholders or when they reneg the deal it could be 20 or 30 for 1 Canopy share commensurate with the Canopy consolidation or they could just add the $38 million to the tax deduction column and walk away from Acreage which would probably tank it and they could swoop around and pick it up for the loan division of STZ as collaterol for default.
I don't like complicated deals because somebody is going to getscrewedover and it is going to be the guys that don't understand what is happening while it is happening.
Critical information needs to be disclosed in a timely fashion for small investors to be able to salvage some of their investment.
Constellation shareholders should have been pretty happy with shareprice appreciation, marketcap increase and dividends.
I can only hope that this management keeps Canopy and Acreage shareholders as happy, with the same kind of treatment.
glta and dyodd