Thoughts On The Anheuser-Busch Acquisition Of The Craft Brew Alliance

, Thoughts On The Anheuser-Busch Acquisition Of The Craft Brew Alliance

This Kona’s for you!

On September 30 it became official.  And we’ve some thoughts on where things could end up for some of the breweries that are now part of AB InBev’s Brewers Collective division.

After announcing its acquisition in November 2019, Anheuser-Busch is now the owner of the Craft Brew Alliance, a Portland, Oregon-based collective of brewing properties that included heritage brewers like Kona, Widmer Brothers and Red Hook Brewery and younger craft operations like Wynwood Brewing and Appalachian Mountain Brewery.

, Thoughts On The Anheuser-Busch Acquisition Of The Craft Brew Alliance

(Gone, Bany, Gone)

The acquisition started in December 2010, when AB InBev bought 32.2% of the Craft Brew Alliance (CBA), just enough for brands like Widmer Brothers to no longer be deemed “craft” according to the Brewers Associations definition, and the beginning of what we expect will be the eventual end of that brand.

Widmer Brothers, which was founded by brothers Kurt and Rob Widmer in 1984, is a true craft beer pioneer that unfortunately just got old and has been largely been abandoned by newer generations of consumers.

AB InBev may attempt some degree of revitalization. But unless Widmer Brothers experiences a real sales turnaround we predict that the brewery could be “dead man walking” in the next couple of years along with another oldster, the Redhook Brewery, which dates back to 1981.

Kona Brewing was the Craft Brew Alliance’s cash cow and is the primary reason that Anheuser-Busch, which passed on the acquisition in August 2019, eventually announced the deal in November.

In 2015 the CBA adopted the sucessful Kona Plus strategy, where they put their marketing juice primarily behind the brewery. And Kona had become the most profitable beer brand in the CBA group when Anheuser-Busch finalized the deal this week.

Though the deal was approved by shareholders in February, the US Department of Justice  required the merger to be restructured to avoid violating competition laws. And AB InBev agreed to divest Kona Brewing’s business in Hawaii to a start-up called PV Brewing Partners.

, Thoughts On The Anheuser-Busch Acquisition Of The Craft Brew Alliance

(It is On!)

As part of the deal, Andy Thomas, formerly CEO of the CBA, will serve as GM of Kona Brewing’s mainland operations and regional Brewers Collective brands based in the eastern US. And Christine Perich, formerly Chief Financial and Strategy Officer for the Craft Brew Alliance, will serve as GM of regional breweries on the West Coast.

And with the CBA now a memory, Thomas and Perich will both report  Marcelo “Mika” Michaelis, President of Anheuser-Busch’s Brewers Collective, the division that oversees AB InBev’s growing line of properties that’s already home to breweries like Goose Island, Wicked Weed, Elysian, Devils Backbone and Golden Road Brewing.

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