Highest rated brewery on BeerAdvocate? Anheuser-Busch.

We all know there are hundreds of thousands of beers in existence nowadays - perhaps even millions if you count all of the nanobrews in circulation. Of that massive collection of beers, there are a top 250 on Beer Advocate:

http://www.beeradvocate.com/lists/top/

But you can whittle that list down even more to the cream of the cream. Of the top 250, you can do the top 15 beers. The absolute top 15 beers in the world...and Goose Island (wholly-owned by AB-InBev) has 3 of them - more than anyone else:

#3, #10, and #11.

Yeah, I know. You can easily point out the fact that these beers are not "Budweiser" or "AB-InBev", as it has the Goose Island label on it, brewed at a brewery known as Goose Island. But we all know that AB-InBev owns the brand and the facilities, and in most cases, all of the distribution as well. They paid for it, bought 100% of the stock, and now its their company, their formulas, their labels, their liquid, and their revenue. Therefore, the true proprietor of those beers (and the recognition of having the highest rated elite beers in this world, according to this metric at least) is AB-Inbev.

For what its worth, they also have the #22, #48, and #83 rated beers on this list as well. 3 beers in the top 15 - and 6 beers in the top 100!

Quite an accomplishment, wouldn't you say? #1 beer company in the world by volume (roughly 1 out of every 4 beers sold on the planet is owned or controlled by AB-InBev) AND they have the highest rated beers on the planet.

(this is what I call being "Devil's Beer Advocate)

 

Its something worth thinking about, right?

It shows that you don't need to innovate and brew the beers yourself. You simply can buy the breweries who are making them, and you "win" by default.

Or as someone in the business world once said, "If you can't beat 'em, buy 'em."

 

correction: they have 6 of the top 83 ;-)

For real though, it is of course cherry picking numbers...but regardless, its worth thinking about. If they managed to pick up a few more breweries, they could have 10-15 of the top 100.

I know that sounds absolutely improbable and ridiculous, but stranger things have happened.

Did you read this? https://www.brewbound.com/news/first-beverage-founder-flood-of-craft-deals-forthcoming

Here’s a bold prediction: 25 craft brewery transactions in the next 12 months.

At least, that’s what Bill Anderson, the founder and CEO of investment and advisory firm First Beverage Group, believes is the inevitable short-term future for craft.

Speaking to a room full of brewery executives, distributors and investment bankers who attended yesterday’s Beer Marketer’s Insights conference in Chicago, Anderson characterized craft beer as the “hottest category in CPG (consumer packaged goods)” and confidently stated that the pace of craft deals is about to pick up.

“I think there could easily be 25 more transactions in the next 12 to 15 months,” he said, adding that attractive multiples coupled with a growing pool of interested buyers and investors has led to “a huge acceleration of brewers” looking more seriously at the both exits and capital infusions from private equity firms, family offices and strategics alike.

“Big checks have a way of opening doors,” he said.

And although Anderson wouldn’t comment specifically on any transactions that his own firm was involved in – First Beverage advised on the Boulevard Brewing, 10 Barrel and Southern Tier deals – he did suggest that some fast-growing craft breweries are fetching as much as 18 times earnings.

Anderson said he’s counted “at least six or seven rollup groups” that are approaching acquisitions with more of a portfolio mindset, adding that many of those companies are also eyeing public offerings as an eventual exit strategy.

Anderson also hinted that one top-ranked craft brewery was currently looking at its own IPO; something he believes could happen within the next six months.

“The business of craft beer is going to radically change,” he said, comparing it to the real estate sector.

“This was a great little neighborhood created by Kim [Jordan], Jim [Koch] and Ken [Grossman],” he added. “Now there are a few people down the street building McMansions. They want to come to your barbeque but they aren’t bringing anything. They just want to eat your food.”

Craft businesses like Boston Beer, Sierra Nevada and New Belgium were more predictable when fewer players were competing in the space, Anderson said. But with more money flowing into craft, the “core business” will become less predictable and motivations will differ greatly from the category’s original founders.

Nevertheless, Anderson doesn’t believe the spirit of the movement or the general collegial nature of craft will suddenly disappear, even as more professional money managers take over the books.

“I think it will be frothy for another two to three years, and I think it will change the nature of the business of this industry, but the consumer part will not be as affected,” he said.

Maintaining the collegiality might be a focus for brewery founders, but not for one investment banker who, prior to attending the Craft Brewers Conference last month, opted for a more aggressive approach to dealmaking.

In a solicitation e-mail sent to craft brewers and obtained by Brewbound, a partner with Arlington Capital Advisors teased a forthcoming “top 15 brewery transaction” and indicated that foreign companies like Heineken International, Asahi Breweries, Carlsberg Group, Sapporo Breweries, and Suntory Holdings all have expressed a “deep interest” in craft.

That same email also suggested that Boston Beer Company and other domestic strategic buyers had made bids on the company’s previous transactions, which include SweetWater Brewing’s minority sale to TSG Consumer Partners and Enjoy Beer’s acquisition of Abita.

And while it’s not known which craft brewery owners are currently looking to sell, Anderson made it clear that more transactions are on the way.

“There is a tremendous amount of money on the sidelines that wants to get into this industry,” said Anderson.

“I think this is a unique window of very high multiples and very able, willing, hungry buyers,” he said. “This window may not happen again for another eight to ten years.”

 

Most likely not. But it happened by default ;-)

Their goal appears to be to control as much of the global market share as possible. They're on a roll with that objective too.

And why is that? Interested in hearing your rationale on this.

It can only happen with your consent, unless its a hostile takeover. But you'd be surprised how many deals are in the pipeline right now. And some big ones too...

perhaps when it comes to street cred, but for purposes of a list, it doesn't really matter!