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US craft beer sell-off continues as Kirin agrees New Belgium Brewing buy

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Japanese brewer Kirin is to buy New Belgium Brewing as another leading light of the US craft beer movement looks set to be snapped up by a multi-national.

New Belgium Brewing was founded in 1991 and is the fourth-biggest craft brewery in the US by volume

New Belgium Brewing was founded in 1991 and is the fourth-biggest craft brewery in the US by volume

Kirin said yesterday its global craft division, Lion Little World Beverages, had signed a "definitive agreement" to acquire New Belgium, the fourth-biggest US craft brewer by volume, according to Brewers Association data. The deal is expected to close before the end of the year.

Financial details have not been disclosed.

In a letter to New Belgium consumers, founder co-founder Kim Jordan said the sale is partly a result of difficulties in accessing cash to increase capacity and reach more consumers. Jordan said many capital-raising options "weren't realistic for us" and could lead to "cost-cutting or a lack of focus on sustainability".

Jordan added: "Having the support and resources of Lion Little World Beverages allows us to attend to those competing priorities and utilise our brewery capacity to its fullest."

New Belgium was founded in 1991 and along with other independent US breweries, such as Sierra Nevada and The Boston Beer Co, helped build the country's craft beer sector into one that competed with mainstream brewers such as Anheuser-Busch and Molson Coors. The operational model those companies built was used as an example by craft brewers around the world, helping to export the US craft beer scene globally.

A slowdown in craft beer's growth in recent years, however, has hit the larger US craft brewers and some have looked for alternative sources of money. Earlier this year, Dogfish Head Brewery, the 13th biggest craft brewer in the US, merged with second-largest The Boston Beer Co. Other breweries have sought funding from private equity.

In previous years, other craft beer veterans have been sold to mainstream brewers. Heineken took full control of Lagunitas Brewing Co in 2017 while over the past decade Anheuser-Busch InBev has bought a number of craft brewers including Goose Island, Blue Point Brewing and Seattle's Elysian.

This month, A-B InBev took complete control of Craft Brew Alliance, which owns the Kona and Redhook Ale brands.

Commenting on the agreement to buy New Belgium, the CEO of Kirin's Lion unit, Stuart Irvine, said: "Kirin has entrusted Lion with leading its global craft beer strategy and today's announcement is an important milestone for all of us as we look to drive growth in markets beyond Australia, New Zealand and Japan."

What does Anheuser-Busch InBev's Craft Brew Alliance buy mean for US beer? - Click here for a just-drinks comment


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