Another craft brewer has been gulped up by a giant. New Belgium, the Colorado-based maker of Fat Tire, is set to become part of Japanese brewer Kirin in a deal announced today.
Kirin will put New Belgium under Lion Little World Beverages, its Australia-based global craft beer division. The all-cash deal, which is expected to close by the end of the year, continues a spate of craft beer acquisitions in recent years, including Heineken’s 2017 acquisition of Lagunitas. The world’s largest brewer, Anheuser-Busch InBev, which has been stockpiling regional craft beer brands, earlier this month acquired full control of Craft Brew Alliance, whose brands include Kona.
But the Kirin-New Belgium deal is notable for its size and symbolism: Founded in 1991, New Belgium is considered one of the icons of the craft beer movement. As industry trade publication Beer Marketer’s Insights notes in its coverage of the deal, New Belgium ranks as the largest-volume craft brewer to sell so far, with 850,000 barrels shipped this year.
Craft brands often face a backlash from hard-core fans when they sell to larger brewers because enthusiasts consider independence from corporate behemoths a point of pride. In a letter posted on the New Belgium website today, co-founder Kim Jordan sought to explain the deal, while getting ahead of any criticism.
“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,” she wrote. The financial constraints “were going to compromise a lot about what makes New Belgium great; environmental sustainability, and a rich internal culture,” she continued, noting that the pressure could have forced “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,” she stated. New Belgium pledged to keep its headquarters in Fort Collins, Colorado.
The deal gives Kirin a stronger foothold in the U.S. The brewer, through Lion Little World Beverages, currently has a minority stake in Brooklyn Brewery, but most of its craft brands are overseas.
“We’re excited to welcome New Belgium Brewing into the Lion fold and take a significant step forward in the largest craft beer market in the world,” Lion CEO Stuart Irvine stated in a press release.