Japanese brewing group Sapporo have announced they will be acquiring leading USA craft Brewer Stone Brewing.
Sapporo U.S.A. and Stone signed a “membership interest purchase agreement” on Friday (24th June) valued at $165 million. An equity transfer will be scheduled for August this year.
Greg Koch and Steve Wagner, Stone’s founders, will step away from the brewing side of the business but will retain their ownership of the Stone Distributing Company, a separate business entity. Stone CEO Maria Stipp will retain her position post-sale.
The San Diego based brewer was known to be in financial difficulty with Ms Stipp admitting during the recent trademark infringement lawsuit with AB InBev that they owed investors VMG/Hillhouse $464 million. She also admitted that the decline in sales over recent years had led the company to consider selling.
Sapporo USA is the maker of the number one selling Asian beer brand in the United States and feels the acquisition will supporting both business’ long-term growth strategies in the U.S. market.
Sapporo intends to produce its Sapporo-branded beers for U.S. distribution in Stone’s two state-of-the-art breweries, in Escondido, California and Richmond, Virginia. Building on existing capabilities, and supported by planned capital investments, Sapporo intends to brew 360,000 barrels (approx. 43 million litres) in the U.S. by the end of 2024. This will essentially double Stone Brewing’s current production and provide ample opportunities for growth for both brands.
In a press release by Sapporo USA announcing the acquisition they explain the reasons for the move to acquire the prominent US brewer “Sapporo gains major, high-quality brewing capacity on both U.S. coasts that will enable it to significantly increase production to meet the strong consumer demand of its Sapporo-branded beers for the domestic market. Stone Brewing gains the resources of the largest Asian beer brand in America and its commitment to preserve Stone’s legacy, culture and innovative approach to craft brewing.”
“We approached Stone Brewing seeking a partner for our growth plans in the U.S, and we quickly recognized they were an ideal partner with bi-coastal brewing capacity, loyal fans, superb management, shared cultural values, and commitment to the highest quality standards,” said Kenny Sadai, Chairman, Sapporo U.S.A. “This acquisition puts the resources and legacy of the largest Asian beer brand in America together with one of the most innovative and recognized craft beer brands in the world. It’s a perfect fusion of east meets west that is an ideal marriage for Sapporo’s long-term growth strategy in the U.S.”
“This is the right next chapter for Stone Brewing,” said Greg Koch, Co-Founder & Executive Chairman of Stone Brewing. “For 26 years, our amazing team has worked tirelessly to brew beers that have set trends and redefined expectations. To have the interest of a company like Sapporo in continuing the Stone story is a testament to the great beers we’ve created and will continue to create for our fans across the globe.”
A notice to Sapporo Group shareholders dated 24th June states “Sapporo Breweries, which is in charge of the alcoholic beverages business of the Sapporo Group, has positioned North America, which is the foundation of our overseas business, and Southeast Asia, which is experiencing remarkable growth, as priority areas where our global expansion is being promoted.”
The move follows a continuing trend of Japanese brewing groups investing heavily in major US craft breweries. In 2017 Sapporo acquired San Francisco’s Anchor Brewing and in recent years Kirin Holdings have acquired New Belgium and Bell’s brewing, as well as several other globally recognized craft brands through their Australian subsidiary Lion Little World Beverages.
