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UPDATE: Green Thumb CEO Releases Letter to Boston Beer Founder, Expressing Interest in Merger

Ben Kovler posted the letter on X a day after Green Thumb Industries stated it doesn't comment on ‘market rumors,’ following a Wall Street Journal article about the letter.

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UPDATE: Green Thumb Industries CEO Ben Kovler released the June 2 letter he wrote to Boston Beer Co. founder and Chairman Jim Koch on June 5, the morning after Green Thumb issued a press release saying it does not comment on "market rumors." 

END UPDATE

Green Thumb Industries CEO Ben Kovler reportedly expressed interest in a merger with the Boston Beer Co. in a letter to the beverage company’s founding chairman, Jim Koch, according to a June 4 Wall Street Journal article.

Based in Chicago, Green Thumb is one of the largest publicly traded cannabis companies in the world with a roughly $2.8 billion market cap, while Boston Beer, the maker of Samuel Adams lager, is one of the largest alcohol companies in the U.S. with a roughly $3.5 billion market cap.

But moments after the WSJ article went live, Green Thumb issued a press release stating, “The company’s policy is not to comment on market rumors.”

The WSJ reported seeing a copy of the letter, according to M&A reporter Lauren Thomas, who wrote that it was sent on June 2.

“Kovler outlined the potential benefits of a combination, including allowing Green Thumb—currently listed in Canada and over-the-counter in the U.S.—to be listed on a major U.S. exchange,” Thomas wrote.

Under federal cannabis prohibition in the U.S., state-legal cannabis companies based in the U.S. are unable to list on major American stock exchanges, such as the Nasdaq and the New York Stock Exchange.

The WSJ report comes two weeks after Carnegie Mellon University released an analysis of U.S. data that revealed daily cannabis consumption now outpaces daily alcohol consumption in the United States. The university report reviewed data from 27 national surveys with more than 1.6 million participants from 1979 to 2022.

Carnegie Mellon Professor Jonathan Caulkins wrote in the report that “In 2022, past-month cannabis consumers were almost four times as likely to report daily or near-daily use (42.3% vs. 10.9%) [than alcohol drinkers] and 7.4 times more likely to report daily use (28.2% vs. 3.8%).”

This change in trending habits for American consumers, paired with the Department of Justice’s forward movement on reclassifying cannabis to a Schedule III substance under the Controlled Substances Act, could potentially change the future landscape for consolidation between the two industries.

“As we look at a future where this consumer trend continues to gain traction, I believe we have to be proactive versus reactive,” Kovler reportedly wrote in the June 2 letter to Koch, according to the WSJ article.

As reported by the WSJ, the Boston Beer Co. made an entrance into the federally legal Canadian cannabis market in 2022 via TeaPot, a THC-infused iced tea brand.

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