New Belgium is the fourth largest independent U.S. craft brewer. Terms of the sale to Lion Little World Beverages, a unit of Japan’s Kirin Holdings, weren’t disclosed. The transaction is expected to close by year-end, providing the company’s employees (who are also its shareholders via an ESOP) agree.
Current New Belgium CEO Steve Fechheimer will continue to lead the company, and the company’s headquarters will remain in Fort Collins. Founder Kim Jordan said she will remain involved.
Lion Little World is looking to build a portfolio of U.S. craft brands, Matt Tapper, managing director of Lion Little World, said.
The transaction will also give Lion Little Magnolia Brewing, which is owned by a New Belgium subsidiary. Kirin itself owns 24.5% of Brooklyn Brewery, the 12th largest U.S. craft brewery, which in turn has minority stakes in San Francisco’s 21st Amendment and Fort Collins Funkworks.
In a letter posted on New Belgium’s website, Jordan said the transaction will result in “more than 300 employees receiving over $100,000 of retirement money with some receiving significantly greater amounts.
“Over the life of our ESOP, including this transaction, the total amount paid to current and former employees will be nearly $190 million. We will have helped a significant number of people realize the upside of having equity in something, being a part of the American Dream!”
Little World, she said, “is committed to strategies to broadly share the wealth going forward, like profit sharing, best-in-class healthcare and a generous family leave policy. Our on-site wellness clinic will carry on. Continuing to practice the rest of what makes New Belgium so cherished by its coworkers: a playful, loving vibe, a culture that encourages learning and experimentation, and an entrepreneurial spirit, will be up to all of us. We are more than up for that challenge and Little World will support us all the way.”
As to why the sale, Jordan noted the need “to balance the cash demands of our ESOP and selling shareholders, with the operational need for more capacity (hence the brewery in Asheville) and the need to grow our brand by reaching more beer drinkers with our brand message.
“These are a lot of competing priorities and it has been difficult to do all of them as well as we’d like,” she said, adding:
“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. Some of the most widely used options by craft brewers were going to compromise a lot about what makes New Belgium great; environmental sustainability, and a rich internal culture. Some of these were going to lead to 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.