Canopy investment ‘has nothing to do with’ our core business, Constellation Brands CEO says

Constellation Brands’ massive stake in cannabis producer Canopy Growth has nothing to do with the welfare of Constellation’s core business, CEO Rob Sands told CNBC on Thursday.

“This has nothing to do with the core business or defending against the potential cannibalization of beverage alcohol by cannabis. There’s really no evidence of that,” he told “Mad Money” host Jim Cramer in an exclusive interview. “And our core business, as we’ve demonstrated in the first half of the year and this quarter, is stronger than ever.”

Instead, the move was a preemptive bet that the popularity of marijuana-based products would rise faster than expected, Sands said, adding that “the future is now” when it comes to cannabis.

“We’re playing offense, not defense,” the CEO said. “Really, what we’re trying to do is take advantage of our strong position, our growth, and invest in an aligned category, which we think … is truly a new frontier of a category that will be at least a couple of hundred billion dollars globally over the next 10 or 15 years.”

Canopy Growth — off of which Constellation has already made a cool $1 billion in unrealized gains, according to Business Insider — has emerged as a leading producer of cannabis-based products.

In August, Canopy CEO Bruce Linton told CNBC he’d like his company, the largest medical marijuana producer in Canada, to become the Amazon or Google of weed.

Saying that he thought Canopy would “certainly be a leader in the industry going forward,” Sands detailed some of the potential products that could come from the partnership between the pot player and his alcohol giant, parent to household names like Corona and Modelo.

“Most likely, the products that will be produced as it relates to beverages will be non-alcoholic beverages. There may be a beer analogue, there may be a champagne analogue, there may be a spirits analogue, there may be a water analogue, a tea analogue, etcetera, all containing some version of cannabis,” the CEO told Cramer on Thursday.

In July, Canopy’s CEO told Cramer that Canada could be the first to see marijuana-infused drinks given the country’s full legalization, set to go into effect later this month.

“We expect we’ll be able to make beverages and those beverages will be no calorie, they will cause you to feel upbeat,” Linton said in an interview, maintaining that there were “no guarantees” in this plan. “We’re talking about going into a bar and having a tweed and tonic.”

Shares of Constellation Brands surged 5.38 percent on Thursday after the company reported earnings well above Wall Street’s expectations and raised its full-year forecast. The stock settled at $222.10 a share.

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