Craft Brew Alliance

Craft Brew Alliance is a beer brewing company that originally was composed of five beer and cider brands:[1]

  • Redhook Ale Brewery, founded by Gordon Bowker and Paul Shipman in 1981 in Seattle, Washington;
  • Widmer Brothers Brewery, founded by brothers Kurt and Rob Widmer in 1984 in Portland, Oregon;
  • Kona Brewing Company, founded by father and son team Cameron Healy and Spoon Khalsa in 1994 in Kona, Hawaii;
  • Omission Beer, developed internally in 2012 in Portland, Oregon; and
  • Square Mile Cider, launched in 2013.
Craft Brew Alliance, Inc.
IndustryAlcoholic beverage
FateAcquired by Anheuser-Busch InBev
FoundedAugust, 2008
Headquarters
Portland, OR
ProductsBeer, Cider
Production output
86,553,060 Liters (724,900 barrels)
Websitecraftbrew.com

Craft Brew describes Kona and Omission as national brands, while the others are regional brands.[2] In addition, Craft Brew launched strategic brewing and distribution partnerships with three other regional companies, whom it acquired outright on October 10, 2018:

  • Appalachian Mountain Brewery, from Boone, North Carolina;
  • Cisco Brewing, Inc. from Nantucket, Massachusetts; and
  • Wynwood Brewing from Miami, Florida.[2]

According to the Brewers Association, Craft Brew is the 9th largest beer brewing company in the United States, based on 2015 sales volume of 824,400 and an annual working capacity of approximately 1,075,000 barrels.[1][3]

As of November 2019, Anheuser-Busch InBev has agreed to fully acquire Craft Brew Alliance in 2020. The acquisition started in December 2010, when AB InBev bought 32.2%[4][5] of the business, became the company's distribution partner,[4] was given two seats on its board of directors, and gained special status in the company's board committees.[5] On August 23, 2019, AB InBev paid Craft Brew $20 million instead of exercising a "pay-or-play" option to buy out the rest of Craft Brew Alliance at a price of $24.50 a share (which would have cost about $328 million).[6][7] As a consequence, shares of Craft Brew dropped more than 20% that day.[7] However, on November 11, 2019, A-B agreed to purchase the rest of Craft Brew for $16.50 a share (about $220 million).[8]

Company history

The company was formed on July 1, 2008,[9][10] with the merger of Redhook Ale Brewery and Widmer Brothers Brewery. CBA acquired Kona Brewing Company on October 1, 2010. In 2012, CBA launched a new brand called "Omission" beer, promoting the beer as specially crafted to remove gluten. In 2013, CBA launched a cider - Square Mile Cider, and in 2014 entered into a partnership with The Chive to create KCCO beer under the independent/Chive-owned Resignation Brewery moniker.[11]

The company was originally named Craft Brewers Alliance, but changed its name to Craft Brew Alliance on January 12, 2012.[12]

As of March 15, 2012, Craft Brew Alliance is publicly traded as NASDAQ: BREW. Prior to this date it was publicly traded as HOOK.[13]

Products

The company produces brands such as Redhook, Widmer Brothers Brewing, Omission Beer and several others.[14]

Redhook

Redhook was founded in the early 1980s in Seattle. At first, the brewery was a small shop in the Seattle neighborhood of Ballard. The beers brewed by Redhook include ESB, IPA, Pilsner, Copperhook, and seasonal brews.[14]

Widmer Brothers Brewing

Widmer Brothers brews various beers including their flagship, Hefe American Hefewiezen, Drop Top Amber Ale, Upheaval IPA, Steel Bridge Porter, PDX Pils, various seasonals and 10+ small batch beers on tap at the Brewery on Russell St.

Kona Brewing Company

The Kona Brewing Company was founded in the spring of 1994 and is Hawaii's largest brewery.[14]

Omission Beer

The company's Omission beer is designed to have low gluten content by using a proprietary enzyme to remove gluten from traditional beer ingredients - namely malted barley.[15]

Square Mile Cider Company

Launched in 2013, there are two primary products under this brand - "The Original" which is a traditional hard apple cider; and "Spur & Vine", which is a "hopped apple cider".

Appalachian Mountain Brewery

On December 2, 2014, CBA entered into a strategic partnership agreement with Boone, NC-based Appalachian Mountain Brewery (AMB).[16] As part of the partnership, CBA acted as "master distributor" for AMB, allowing their products to ship via the Anheuser-Busch InBev distributor network. CBA had taken an undisclosed, minority stake in AMB. On October 10, 2018, CBA announced that it acquired 100% of the AMB brand, brewery, and pub. The transaction closed November 29, 2018.[2]

Cisco Brewers, Inc.

On September 25, 2015, CBA announced a strategic partnership agreement with Nantucket-based Cisco Brewers.[17] As with previous partner, AMB, CBA acted as "master distributor" for AMB, allowing their products to ship via the Anheuser-Busch InBev distributor network. CBA had taken an undisclosed, minority stake in Cisco Brewers. On October 10, 2018, CBA announced that it had acquired 100% of the Cisco intellectual property assets related to its malt beverage products; Cisco's founders continue to own and operate the Cisco Brewers brewpub properties and retail merchandising, including the original brewery and grounds in Nantucket.[2]

Wynwood Brewing Co.

On December 15, 2016, CBA announced a strategic partnership agreement with Miami, FL-based Wynwood Brewing Co. ("Wynwood").[18] CBA took a 24.5% stake in Wynwood, valuing the deal at under $30 Million. As with previous partners AMB and Cisco Brewers, CBA acted as "master distributor" for Wynwood, allowing their products to ship via the Anheuser-Busch InBev distributor network. On October 10, 2018, CBA announced that it had acquired the remaining 75.5% of equity in Wynwood, making Wynwood a wholly owned subsidiary of CBA, although Wynwood co-founders Luis Brignoni and his father “Pops” Brignoni would continue to run the operations.[2]

Sustainability Initiatives

Through investments in renewable energy, closed-loop systems, and energy intensity, the company is improving their operations and efficiency. The company utilizes BMS software at their breweries to access real-time tracking of key performance indicators to help reach sustainability targets.[19]

Officers and Directors[20]
NameTitle
Kurt R. WidmerChairman Emeritus
Andrew J. ThomasChief Executive Officer
Christine PerichChief Financial Officer, Treasurer
Scott MennenChief Operating Officer
Dan PartelowVP, Commercial Development
Peter SchaufVP, International Sales
Derek HahmVP, Sales & Brewpubs
Ken KunzeChief Marketing Officer

On November 21, 2013, the company announced that, effective January 1, 2014, Andy Thomas will take over as the company's new CEO.[21]

On May 20, 2015, CBA announced the appointment of Joe Vandersteldt to CFO, along with several other changes at the executive leadership level.[22][23]

Use of the term "craft brew"

While the company name contains the phrase "craft brew", it does not meet the definition of a craft brewer according to the Brewers Association,[24] due to the percentage stake owned by Anheuser-Busch InBev.[4][25][26][27] The Brewers Association defines American craft brewers as "small, independent and traditional", with 'small' defined as an "annual production of 6 million barrels of beer or less", a limit changed in 2011 from 2 million to 6 million to ensure the ongoing inclusion of Boston Beer Company[28] (the producer of the Samuel Adams brand), 'independent' defined as at least 75% owned or controlled by a craft brewer, and 'traditional' defined as at least 50% of its volume being all malt beer.[24][27]

See also

References
  1. CRAFT BREW ALLIANCE, INC. ANNUAL REPORT For the Fiscal Year Ended: December 31, 2015 Retrieved 26 August 2018.
  2. "Craft Brew Alliance form 10-K for fiscal year ended December 31, 2018". March 3, 2019. Retrieved November 12, 2019.
  3. Brewers Association Lists Top 50 Breweries of 2015, Brewers Association, 5 April 2016.
  4. 10 Craft Beers that Aren't, The Street, January 4, 2013.
  5. "Craft Brewers Alliance, Inc. Form 10-K". US SEC. p. 18. As of December 31, 2010, A-B owns approximately 32.2% of our outstanding common stock and, under the Exchange Agreement, has the right to appoint two designees to our board of directors and to observe the conduct of all standing board committees.
  6. Kendall, Justin (August 23, 2019). "Anheuser-Busch InBev Doesn't Make Qualifying Offer for Craft Brew Alliance". Brewbound. Retrieved November 11, 2019.
  7. Meunier, Andre (August 23, 2019). "Anheuser-Busch opts not to buy Portland's Craft Brew Alliance". The Oregonian. Retrieved November 11, 2019.
  8. Rogoway, Mike (November 11, 2019). "Anheuser-Busch buys total control of Portland's Craft Brew Alliance for $220 million". The Oregonian. Retrieved November 11, 2019.
  9. Craft Brewers Alliance Archived 2011-12-09 at the Wayback Machine accessed 08-30-2009
  10. Post-merger Widmer reports profit Portland Business Journal, August 12, 2009
  11. Craft Brew Alliance Reports Second Quarter 2013 Results, Craft Brew Alliance official web site.
  12. "Craft Brewers Alliance is now Craft Brew Alliance". Archived from the original on 2015-06-11. Retrieved 2013-10-09.
  13. Craft Brew Alliance Changes Ticker Symbol to 'Brew' accessed January 8, 2013
  14. brands of company, accessed, Oct 29, 2013.
  15. "Drinking is Believing | F.A.Q". Omission Beer. 2013-11-21. Archived from the original on 2016-11-30. Retrieved 2016-11-30.
  16. Appalachian Mountain Brewery. "Appalachian Mountain Brewery". Appalachian Mountain Brewery. Retrieved 2016-11-30.
  17. Craft Brew Alliance. "Cisco Brewers". Craft Brew Alliance. Retrieved 2015-09-25.
  18. Brewbound. "Wynwood Brewing". Brewbound. Retrieved 2016-12-15.
  19. "Sustainability Hero: Julia Person brings energy efficiency to craft brewing". Lucid. Retrieved 2018-11-13.
  20. Key People in CBA
  21. Next CEO for CBA - Andy Thomas
  22. "Craft Brew Alliance Inc (BREW.O) Key Developments". Reuters.com. Retrieved 2016-11-30.
  23. "Craft Brew Alliance Inc (BREW.O) People". Reuters.com. Retrieved 2016-11-30.
  24. "Craft Brewer Defined". Brewersassociation.org. Archived from the original on 2011-07-10. Retrieved 2012-03-16.
  25. That Craft Beer You're Drinking isn't Craft Beer – Do You Care?, Time Business & Money, August 13, 2013.
  26. Report: The Craft Beer Industry's Big Year, Associations Now, March 20, 2013.
  27. Brewers Association: Craft Beer is Now a $10 Billion Category, Brewbound, March 18, 2013.
  28. "10 Craft Beers That Aren't". TheStreet.com. Retrieved 2013-11-24.
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