Yesterday Constellation Brands, the country’s third largest beer producer, announced that they’d purchased Texas-based Four Corners Brewing furthering their reach in the craft beer segment and reconfirming a possible shift in its acquisition strategy.
In 2015, Constellation Brands sent shockwaves across the when they announced the $1 billion acquisition of San Diego’s Ballast Point Brewing & Spirits. It was the Victor, NY-based beverage company’s first entrance into the craft beer segment, nor would it be their last.
In 2017, Constellation purchased Funky Buddha a buzzy Florida brewery with more of a state-wide strength than a national presence signaling a shift in their acquisition strategy to a more regionalized approach.
The Four Corners Brewing acquisition is yet another sign that although Constellation Brands continues to see value in a slowing craft beer segment and that they are taking what might be seen as a more conservative stance in both scope and scale that better reflects craft beer’s changing metrics…
Would Constellation Brands, Fortune 500 company, and international producer and marketer of beer, wine and spirits make the same deal they did for Ballast Point if they were purchasing it today? We expect that they wouldn’t, certainly not a $1 billion deal.
But staking a claim in Texas, with a brewery whose sales that have increased “five-fold” since 2014 according the issued press release, reflects not only craft beer’s changing landscape but Constellation’s understanding that it has.
With most of the acquisition action primarily taking place in the UK lately, Constellation’s announcement that they’d purchased a Dallas player with the capacity to produce 25,000 barrels annually stands as a reminder of craft beer’s current strength in the US as well as its value.
And unlike Constellation’s $1 Billion purchase of Ballast Point in 2015, the terms of yesterday’s deal were not disclosed.