The craft beer feeding frenzy circa 2015 continues.
MillerCoors, the second largest brewing operation in the United States when measured by market share, has announced its first ever craft brewery acquisition, Saint Archer Brewing of San Diego. The deal was announced just days after global giant Heineken announced its deal to purchase 50 percent of Lagunitas, another California craft brewery and marks a growing trend toward consolidation in the industry.
Saint Archer was, for a craft brewery, a large and successful operation. Total output was estimated at 35,000 barrels of beer in 2015 and Saint Archer beers have received several awards, including a Gold Medal for Saint Archer White Ale at the 2014 Great American Beer Festival. Positive accolades from craft beer fans, multiple awards, and a growing business- all of these factors added to Saint Archer’s appeal as a takeover target.
Saint Archer is presently distributed only in California but with the distributing muscle and marketing clout of MillerCoors, it will likely morph into a national brand.
“How and when we get to the East Coast remains to be seen, but we will extend the brand across the country,” said Pete Marino, MillerCoors spokesman.
With craft beer still on the rise and sales still climbing, can we expect more acquisitions in the future? The answer is yes and it could happen at any time, to most any brewery. Many craft brewery owners swear they won’t sell out for any price. But who among us would be able to resist the chance for a quick ticket to instant riches? Terms were not disclosed, but Saint Archer likely sold for around $30 to $35 million. If you owned a craft brewery, would you be able to resist an offer like that?
Saint Archer’s transition from independent business to global beer subsidiary isn’t the end of the craft beer feeding frenzy. There are likely to be more acquisitions in the coming months as large breweries seek to replace tired, old beer brands with fresh, exciting, and often highly profitable craft beer. Of course, craft beer fans in San Diego and elsewhere are already crying foul and some have already eliminated Saint Archer from their beer drinking rotation. But this trend toward buyouts isn’t going to come to an end anytime soon.
Don’t be surprised if you wake up to headline news about your local brewery’s acquisition by MillerCoors, Anheuser- Busch InBev, Heineken, or some other brewing behemoth. The drive for improved market share will prevail, and there is little anyone can do to stop it.
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