Anheuser-Busch InBev has said it will sell eight of its brands to US-based Tilray Brands, in an all-cash deal worth $85m.
The deal includes AB InBev’s Shock Top, Breckenridge Brewery, Blue Point Brewing, 10 Barrel Brewing, Redhook Brewery, Widmer Brothers Brewing, Square Mile Cider, and HiBall Energy brands. It includes four production facilities – two in Oregon, one each in Colorado and New York – as well as existing staff, brewpubs, and breweries associated with the brands.
Tilray is a cannabis-lifestyle and CPG company, with brands including SweetWater Brewing, Montauk Brewing, Alpine Beer, Green Flash Brewing, and Happy Flower CBD. The deal will help diversify its portfolio and makes it the fifth-largest craft beer business in the US, up from ninth. Tilray forecast pro forma revenue of $250m from the deal.
Irwin Simon, Chairman and CEO of Tilray Brands, said: “Leveraging the deep CPG expertise of Tilray’s leadership team and acquisition integration track record, we intend to drive both revenue and cost synergies, while significantly expanding national distribution to coveted markets across the US and internationally.”
Ty Gilmore, President of US Beer at Tilray Brands, added: “With this transaction, our beer business is expected to triple in size from 4 million cases to 12 million cases annually. Looking ahead, we will further capitalise on the potential of these brands through product innovation, retailer partnerships and expanded distribution into key markets, including the Pacific Northwest and California.”
The deal is expected to be completed in 2023.
NAM Implications:
- Rivals will experience changes from two directions:
- AB InBev becomes more competitive via a skimmed down portfolio
- The new owners of spun-off brands will compete via brands having more attention
- …and in order to justify the purchase.
