MillerCoors taps craft beer with Saint Archer acquisition
- MillerCoors LLC is the latest major beer company to move in on the craft beer industry, as it has acquired its first craft brewery, Saint Archer Brewing Co.
- Saint Archer has an estimated value of more than $35 million when taking into account its expectation to sell 35,000 barrels of beer this year, and craft brewers' valuations for recent acquisitions have come in at more than $1,000 a barrel.
- MillerCoors had not leapt at the chance to acquire a craft brewery at first because of the high valuation price involved, but Saint Archer was attractive "because the brewer is located in a strong craft-beer market, has a leading India Pale Ale known as Saint Archer IPA and has no distribution outside California, which will allow MillerCoors to spread it across its network of distributors nationwide," according to The Wall Street Journal.
As the craft beer industry continues to thrive, reaching 11% volume market share in 2014, more larger breweries are taking notice and trying to use that success to counter the falling sales of their own lagers and light beer.
Earlier this week, Heineken International announced it would be acquiring a 50% stake in Lagunitas, one of the country's largest craft breweries, and Anheuser-Busch has announced four craft brewery acquisition plans since 2011.
In addition to acquisitions, larger beer companies have looked to craft breweries for inspiration to make their own products more appealing to consumers. Guinness, for example, launched a new series of beers, called "Brewers Project," as well as an ad campaign, known as "Gates." Both take cues from the craft beer industry in terms of beer varietals and style of marketing, which accentuates the local aspect and story behind the brewing process.
Last month, Reuters reported that several craft breweries were looking to strike a deal with major brewers and investors due to maxed-out production capacity and desires to expand product lines and distribution.
- The Wall Street Journal MillerCoors Acquires Craft Brewer Saint Archer
- Brewbound MillerCoors Acquires Majority Interest in Saint Archer Brewing Company