Constellation Brands is increasing its stake in Canopy Growth Corporation, investing another CAD 5 billion ($4 billion) in the company and taking its overall holding up to 38%.

The investment is described as “a significant expansion” to their existing partnership, and represents Constellation’s ambition to become a leading player in cannabis beverages amid an increasingly favourable legislative landscape.

“Through this investment, we are selecting Canopy Growth as our exclusive global cannabis partner,” said Rob Sands, chief executive officer of Constellation Brands. “Over the past year, we’ve come to better understand the cannabis market, the tremendous growth opportunity it presents, and Canopy’s market-leading capabilities in this space. We look forward to supporting Canopy as they extend their recognised global leadership position in the medical and recreational cannabis space.”

Constellation is acquiring 104.5 million shares from Canopy Growth, nearly trebling its current stake in the business.

And it has the option to eventually take its holding to beyond 50%.

In June, Canada voted to legalise cannabis for recreational use, making it only the second country after Uruguay to completely decriminalise the drug. In addition, according to Business Insider, nine US states – along with Washington DC – have legalised marijuana use to some extent.

It has created a burgeoning category: earlier this month, Molson Coors Canada announced it was partnering with Canadian cannabis producer Hydropothecary Corporation (Hexo) to create a joint venture that will sell cannabis-infused beverages.

Constellation’s latest investment, described as “the largest to date in the cannabis space”, will provide funds for Canopy Growth to build or acquire greater scale in both medical and recreational cannabis markets. Constellation pointed out that Canopy Growth’s Canadian platform did not need to ramp up cultivation.

But it did say that “Canopy Growth’s future plans include pursuing various product formats in all cannabis channels”.

Bruce Linton, chairman and co-CEO of Canopy Growth, added: “Our business can now make the strategic investments required to accelerate our market position globally.

“Constellation’s concentration of global cannabis activities exclusively through Canopy, coupled with the investment and its expert capabilities in brand-building, marketing, consumer insights and M&A, will be a huge benefit as we look to expand our portfolio in Canada, the US and emerging cannabis markets around the globe.

“We view this investment in our business as an endorsement of our execution since forming our initial strategic relationship in October 2017.”

The investment is subject to customary closing conditions and is expected to close by the end of October 2018.