New Belgium Brewing Co. announced today that it has set the mechanisms in motion to be acquired by Lion Little World Beverages, an Australian beverage and hospitality company best known for its ownership of Little Creatures brewery. Lion was formed in October 2009 under the name Lion Nathan National Foods when Kirin Holdings Company Limited purchased brewer Lion Nathan and merged the business with National Foods. Today, Lion is a subsidiary of Kirin.
New Belgium Brewing is known as one of the craft beer industry’s biggest ESOPs, but if this transaction goes through, that will be no more. According to a post by Kim Jordan, cofounder of New Belgium, more than 300 of New Belgium’s employee-owners will receive more than $100,000 in retirement money through the deal. New Belgium employs nearly 700 people between its Fort Collins, Denver and Asheville, N.C., properties.
We are unaware of what Lion paid to acquire one of the most famous American craft breweries, but rumors have swirled for years of its potential sale. Why this move now? From Jordan’s letter:
We all know the world of craft brewing is dynamic. In the US, the number of breweries has nearly doubled in the last four years to 7,500. At New Belgium, we’ve needed to balance the cash demands of our ESOP and selling shareholders, with the operational need for more capacity (hence the brewery in Asheville) and the need to grow our brand by reaching more beer drinkers with our brand message. These are a lot of competing priorities and it has been difficult to do all of them as well as we’d like. As we surveyed the landscape over the last several years, we found that options to raise capital while being an independent brewer weren’t realistic for us. Some of the most widely used options by craft brewers were going to compromise a lot about what makes New Belgium great; environmental sustainability, and a rich internal culture. Some of these were going to lead to cost-cutting or a lack of focus on sustainability. Having the support and resources of Lion Little World Beverages, allows us to attend to those competing priorities and utilize our brewery capacity to its fullest.
Joining Little World Beverages to anchor a US Craft Beer platform is so congruent with all the things we’ve committed ourselves to at New Belgium that we jumped at the opportunity to offer this to our shareholders. We’re thankful for Lion and Kirin’s support of our values and I’m excited to help to build a collective of breweries along with the management of New Belgium, who share the same commitment to delighting beer drinkers: with great beer, great businesses and great collaboration amongst us.
So it goes.
According to the release, New Belgium Brewing headquarters will remain in Fort Collins, Colo., and Steve Fechheimer will continue as chief executive officer with the management team. Kim Jordan will remain deeply involved with the company, and also play a key advisory role in collaborating alongside other leading founders within the Lion Little World Beverages network.