In the beer industry of a decade ago, the word “acquisition” meant something quite different than it does today. Rather than multinationals spending millions—or a billion—to acquire smaller independents, today’s acquisitions are more likely to come in the form of relatively small breweries buying up other small breweries.
The past five years have seen craft-on-craft deals make national headlines, such as Deschutes acquiring Boneyard in Bend, Oregon, in March 2021. There are also plenty of smaller transactions at a regional level, including the October announcement that 4NB Holdings, which owns 4 Noses Brewing and Wild Provisions, would buy fellow Colorado brewery Odd13. Brewery “collectives”—such as Community Brewing Ventures, CANarchy Craft Brewery Collective, and Artisanal Brewing Ventures—are now a commonly understood arrangement. It’s one that didn’t exist in 2011, when Anheuser-Busch InBev bought its first craft brewery, Goose Island.
A few factors are behind this new scale of acquisition. First and foremost, global beer companies just aren’t buying the way they were years ago.
“The reality is that a very small percentage of craft breweries are going to get acquired by big brewers,” says Kimberly Clements, cofounder and managing partner of beverage advisory company Pints LLC. Multinationals, she says, “were looking for long-term, sustainable scale—something they [could] expand regionally or even nationally.”
Another thing that’s very different from a decade ago is the sheer number of breweries—now approaching 9,000 in the United States, compared to 2,252 in 2011. Inevitably, owners want to retire or move on from the industry—and the trials of an unforeseen pandemic may have hastened that choice for some.
However, many have built successful brands that they’d like to see live on—and that could still provide value if added to another company’s portfolio.
That’s what Brendan O’Donnell is looking for. He’s the CEO of Newport Craft Brewing & Distilling in Rhode Island; his company acquired Brooklyn, New York, breweries Braven and Radiant Pig in 2019 and 2020, respectively. The company also has about 1,500 barrels of spirits currently aging on its distillery side, while building a space to house 10,000.
“If you have a collective of the right brands in the right regions that people care about, and [if those brands] don’t have to worry about things like their books or their excise tax and can pool their marketing resources and hop contracts and can contracts, and bring different philosophies together, it makes a lot more sense,” O’Donnell says. “It creates strength in numbers.”