Hydropothecary, Molson bank on Canadians’ thirst for weed-infused beverages
A new partnership between Molson Coors Brewing Co. and Canadian pot producer Hydropothecary Corp. comes as beer sales are stagnating, but it also anticipates a potentially “massive” market for cannabisinfused drinks that could pick up the slack.
On Wednesday, Hydropothecary and Denver-based Molson announced the formation of a joint venture that will develop non-alcoholic, weed-injected beverages. The company is being set up ahead of Canada’s planned legalization of recreational cannabis in October, as well as the expected sales of edible marijuana products next year.
Sébastien St-Louis, chief executive and co-founder of Gatineau, Que.-based Hydropothecary, said they had yet to place a dollar value on the potential market for cannabisinfused drinks, as they would await forecasts from the joint venture’s management team.
“But this is a material opportunity for both companies,” StLouis said. “And we expect the revenue from adult-use cannabis beverage to be massive.”
The deal could also underscore the overall importance of edibles for Canada’s coming cannabis market. The significance may be even more so for big brewers that were already under pressure from craft competitors, and that now face the introduction of a new legalized substance for consumers to buy: cannabis.
Molson Coors reported Wednesday that net sales saw a year-over-year decline of 0.2 per cent for its second quarter, to US$3.1 billion.
Frederic Landtmeters, president and CEO of Molson Coors Canada, said the deal with Hydropothecary was being formed ahead of an expected increase in the overall acceptance of cannabis by Canadians. .
The joint venture will be set up as a “standalone” startup. Molson would own 57.5 per cent; Hydropothecary would own the other 42.5 per cent.