Marijuana stocks soared Monday after a report yet another beverage giant is looking to get into the industry — and this time it was the biggest beverage company of them all.
Aurora Cannabis, a Vancouver, Canada-based cannabis producer, rallied more than 14 percent in early Canadian trading Monday after Canadian news service BNN Bloomberg reported Coca-Cola is in talks with Aurora to develop weed-infused beverages. Any partnership between the two would likely develop health-focused beverages aimed at easing inflammation, pain and cramping, the report said.
Other companies with exposure to the cannabis market, including Tilray and Scotts Miracle-Gro, also gained on the week’s first day of trading. Tilray climbed 9.7 percent and Scotts added 2.5 percent in U.S. trading. Canopy shares added 3.5 percent in Canadian trading.
Aurora offered the following statement to CNBC:
“Aurora has expressed specific interest in the infused beverage space, and we intend to enter that market. There is so much happening in this area right now and we think it has incredible potential. As a rule, we do not discuss business development initiatives until they are finalized, however we have a responsibility to our shareholders to give proper consideration to all relevant opportunities that are presented.”
Coca-Cola offered this statement:
“Along with many others in the beverage industry, we are closely watching the growth of non-psychoactive CBD as an ingredient in functional wellness beverages around the world. The space is evolving quickly. No decisions have been made at this time.”
Though the move in marijuana stocks is mostly headline-driven thus far, Coca-Cola wouldn’t be the first beverage titan to test the waters with an investment in a cannabis producer.
Corona beer maker Constellation, for example, upped its bet on the industry last month, announcing an additional $4 billion stake in Canopy Growth. Molson Coors, too, announced in August that its Canadian unit is entering into a deal that will develop cannabis-infused beverages in Canada.
The Denver brewer said Molson Coors Canada is partnering with Canadian cannabis producer The Hydropothecary Corporation (HEXO) to create a joint partnership “to pursue opportunities to develop non-alcoholic, cannabis-infused beverages for the Canadian market following legalization.”
Marijuana use in Canada will be legal in mid-October after legislation cleared regulatory hurdles in June.
The headlines have caused these stocks to soar. Canopy shares have doubled this year in Canada. Tilray, which made its debut in July, has more than tripled in the last one month alone.