First Firestone, now Lagunitas

[Kealia]

Heineken boosts craft beer collection with 50% stake in Lagunitas

I'm sure there are many articles out there so I'm just citing one.

Here's a quote from another:
"Tony Magee, founder of Lagunitas, will remain at the helm, with the same leadership and staff, same brewers, same recipes and same suppliers and distributors helping to drive the brand forward."

Let's hope that remains true.

[Beer-lord]

You could really see this coming years ago right? I mean anything that's doing well will let those with money buy their place in or near the front of the line.

[Kealia]

If it truly is for wider distribution, etc. than I'm all for it (much I like I said with Firestone/Duvel). If it affects the product, that would suck.

You would *think* it would be idiotic to change the product at all since that is what made Lagunitas successful and attractive for something like this but we've all likely also seen big business do stupid things.

<fingers crossed>

[bpgreen]

I remember reading an interview of one of the brewers who sold to one of the big breweries and in one comment, he said that he was getting access to equipment that he otherwise never would have been able to afford. The big brewery wasn't using it and had decided it wasn't worth the time or effort to sell, but they'd give it to him for free.

[FedoraDave]

It can seem dismaying, but as pointed out, it doesn't make much sense to change the profile that made the brand successful in the first place.

At my daughter's wedding this weekend, the venue was contractually obligated to serve AB/InBev beers. They were able to finagle both Goose Island Oktoberfest and Stella Artois (some strings were pulled, as the Goose Island should have meant that Bud Lite was the other alternative). I stuck with the Oktoberfest, and it was simply wonderful. So perhaps there's a sea-change occurring with these acquisitions.

[Stinkfist]

I new it was going to happen with all the popular ones....I still think beer should be made a drank locally...More Smaller Breweries will always be better than a few large ones....but that is not how big business works....it's a shame.. Good thing I can make my own

[Kealia]

I agree in concept but the fear is that they eventually do something like make Lagunitas use a different base malt because Heiny gets a better deal on it, etc. Or they use a cheaper X, Y or Z - just one little thing that leads to another and another.

I hope it doesn't go down that way for Lagunitas and Firestone. And every other craft brewery that enters into a deal like this honestly. For Tony, it is likely a dream come true. What he started in his attic is going international. What could be better for him, right?

[mashani]

I'd like it better if Duval had bought into them. At least Duval makes good beer. And AFAIK, they have not messed with Ommegang in any way from a quality of ingredients standpoint.

[Pudge]

On one level, it reminds me of college football realignment. Money talks and tends to make strange bed fellows.

I think craft beer is trending away from national or even regional brewers. Everybody has at least somebody making great beer locally theses days, right? There is pressure at all levels from the industrial mega brewers to folks at Laganitas to grab as much sharehold of the market they can when the opportunity presents itself. If they had said no to the deal, somebody else would have said yes.

[Gymrat]

For those saying it doesn't make sense to change what has been successful, you better look at what anhieser bush did to Rolling Rock beer. For that matter you better take a look at what they did to their flagship budwieser beer. They will cut an trim anywhere they can to make profits look good on paper to please the stock holders. It isn't about customer satisfaction anymore. It is only a matter of time before changes come to Lagunitas.

[BlackDuck]

Last night I attended a town hall meeting held by BrewDog to discuss their plans to build their brewery in my hometown. During the Q&A, someone actually brought this up. He asked why they would spend so much of their money to come to the US instead of selling a portion of the company to someone like AB/InBev to get into the US market. The answer was very straight forward....the girl from BrewDog said that those companies are not about craft beer. The only thing they care about is the bottom line...they are a public company, so they HAVE to answer to the shareholders. She basically said what Gymrat is saying, they will eventually change things to cut the costs. And that, in turn, takes the passion and creativity out of craft beer. One thing that I can quote her saying is "We buy a shit ton of hops" just to experiment and have fun with. Which would never be allowed to happen if they were owned by one of the big boys. It was a great reply. I wish I would have recorded it.

[Rebel_B]

That is a memorable quote!

[RickBeer]

I'm keeping an open mind about these acquisitions. Yes, a company like Bell's or BrewDog doesn't have to answer to public shareholders, but they have to answer to investors. Some, like Bell's, and perhaps BrewDog, may in fact have a very small group of owners and be able to do anything they want to. HOWEVER, once they get big enough they can't play as much anymore because they have to stay focused on ensuring that the distribution chain remains stocked. So, unless they have a specific group of people dedicated to doing whatever they want to, it's hard for the core people to say "hey, let's screw around but not screw up our production schedule that we MUST hit".

I'd also say that these big companies aren't stupid. Yes, some of them at some point in time may have tried to introduce sub-standard fake craft beer and either they were successful at it or they weren't. As the craft movement keeps growing, they change strategies and maybe try to stay more true to the origins of the company they bought/invested in.

What you have to realize is that as a private company you still have to answer to THE BANKS. They expect forecasts, and expect you to hit your numbers. Miss your numbers, and the line of credit shrinks or goes away. At least with a big company investing/owning you they have very deep pockets and you're a blip in their numbers. So if you need say $100 million, they have it in their other pocket.

Edit - I'd also point out that the vast majority of beer drinkers don't give a rat's behind about the craft movement, and that's who the biggies are selling to. Buying a craft brewer and making them huge will likely just dilute their business over another label, not help them gain anything - where keeping it true to origins helps them nip at their competitor's heels.

We'll see how it goes.

Many years ago I worked for a company that was a very, very, very small piece of a huge company. We were "the icing on the cake". We spent in a year what they spent in a week. Our revenue was liek 1% of the total. But we were very profitable. As a result, we'd plan on a marketing event (catalog mailing) of say 20 million catalogs and then a few weeks beforehand would decide to mail 26 million catalogs, raising all costs. So instead of spending say $10 million, we'd spend $13 million. Never once did they stop us, although I did get a call from the Treasurer at Corporate one day to the effect of "you needed $5 million for postage and now you want $7 million? Do you think money grows on trees?". I said "it doesn't?". He asked me in the future to provide him with advance notice, which I could not do due to the firewall between the organizations, and they were public. However, I setup a COUGH CODE. I called him and said "Hey Bob, how are you? Cough, cough." Each cough was $1 million more of postage money I needed. Worked great.

[Beer-lord]

I have the same problem......I also buy a shitload of hops but proportional, of course!

[swenocha]

The deal doesn't much bother me, but I find it ironic, considering what Tony Magee, founder of Lagunitas, was saying just a few years ago about AB InBev's Goose Island purchase: “What they really want to do is disrupt this whole craft thing so they can go back to the business that they’d like to be in, which is making lighter beer with inexpensive ingredients.” Hmm... I wonder what changed for him?