Constellation Brands to Acquire Ballast Point Brewing & Spirits

most shops, stores, chains, etc, ABI has lost more shelf space for macros and only retained very little that was lost with beers from breweries they acquired.

I think he was more spot on in his breakdown of how it works. These small breweries that are supposedly being edged out of space isn't due to big beer as much as people think. Does xyz local brewery have someone to call on the buyer from the chain that decides on what beers they carry in stores? Krogers not going to call the breweries saying they want to carry their beer, there's what 4000 breweries now? Someone needs to meet with the buyers, show them the product, let them know what's in it for them to get that shelf space. If they can do that, bigger issue I've seen with smaller breweries that make it into a chain, even small regional grocery chains....can they fill and maintain the pipeline? Now you have your product in 100+ Stores schematics, that shelf better never be empty due to production.

The big displays and end caps are usually warranted by sales. I don't think anyone's going to put a huge display of something that's not going to turn quickly. 60 cases of popular macro will be sold a lot quicker than a craft product (generally). Also, a lot of stores don't even stock their own shelves. Who's going to maintain that big display and keep it looking good?

Unsure of states where offering free beer to bring it new brands would be legal, but that seems unlikely/uncommon. We have ABC laws here, it's not Mexico. I don't think any things forced in the least, but the AB guy pitches their new goose IPA 6 packs to test out and it works or doesn't. Plenty of AB owned 'crafts' get cut out of schematics due to lack of sales. Just happens they seem to have the products, people, resources to possibly have an alternative to replace it with.

 

I don't like it, but a billion dollars gross without having to sell a single unit or invest more in the infrastructure is just too good to pass up. The market is so competitive now, who knows if they will be able to keep their current place and build onto it. Now they don't have to deal with that, and will probably pull down more cash than they could running the company. The question certainly begs, what is Stone or Founders worth if BP is worth that much? I was surprised as hell that Lagunitas sold out; I thought they were doing well and the owner enjoyed being his own boss and running things his own way, but just about anybody has their price except for maybe Jim Koch and Ken Grossman, we'll see. I'll keep drinking the beers that I like best, and are available to me unless it poses an imminent threat to all mankind

 

Makes the $39 Million AB paid for Goose Island not too long ago look like loose couch change, goes to show you how much craft beer has gained not only with the public but with investors as well.

 

good for them

 

Ballast Point would have to have been utter morons to turn that deal down. I'm happy for them. Still I'm more likely to give my money to smaller local breweries. They need it more than the megacorporations. I won't boycott it just because they were bought, but the fact that it is owned by the big boys will likely enter in my decision making process.

 

By this you mean they are the same? i.e. non micro? So this is their second brewery to purchase and they are lumped in with InBev, which has garnered no love here because of some of their distribution/advertising...<goes on forever>. I guess I am trying to understand why they are lumped together

 

Couldn't every mega corp technically buy 90% of the top 50 of the craft breweries? Would people be happy for each and every one of them? After all, they got paid $$$ out of the BIG boys pocket.

For me, I see it as a infiltration of BIG $$$$ into a sector that seemed a bit more "home grown rooted" (as BP put it on their SEC IPO filings just weeks ago).

Would you all be okay if 90% of what you drank had profits going to what we consider macro, or
"big business"? The enemy silently became benefactors.. Nice play macro

 

Other than folks from the macros posting here, it's really hard to understand how anyone can say something like: "as long as the beer tastes the same - who cares?"
Choice among brands is the real factor here. As long as choice remains, then we're fine.
The evolution of craft beer in San Diego, at least, has been fundamentally defined by a culture of 1) mutual support among brewers, and 2) celebration of variety and choice. These factors have significantly benefited the the growth and popularity of this industry over the past 25 years. Have the mega-Brewers suddenly embraced this ethos, because they certainly have not demonstrated it in the past (have you already forgotten the Budweiser Super Bowl commercial?)?
*If* the beer monopolies supported the independent craft brewers as a valuable part of the ecosystem, that would be one thing. If, instead, they use their purchasing power to marginalize independent craft brewers and make it harder for them to exist and to innovate, then every dollar you spend on mega-brews (including newly-acquired mega-brews) simply helps push us back to the "bad old days" when every beer was a diluted Pilsner.

 

I don't find it hard to understand. I don't ever see this happening. To realize how beer became what it did you have to go back thru history and study the cause and effect of prohibition, 2 world wars and other factors that occurred that shaped the beer industry. The resurgence of beer over the past 2 decades is just in keeping in line with other things that have improved, food, wine, liquor. Once you have had something good, it is very hard to digress back, unless some action or force causes it, i.e. prohibition v2.0 another world war where resources are scarce. So no I don't buy that big beer occasionally buying up another brewery is going to end the world of beer as we know it.

 

That may be, and I hope you're right, of course. However, the point is that ABInBev and their ilk hope you're wrong. And they are obviously adversarial toward to the independent craft brewer and are willing to spend big money to maintain/re-establish their monopoly.

 

And Ballast Point/Home Brew Mart were at the epicenter of the evolution of craft beer in San Diego. I don't know what to tell you, besides the obvious. Things change. You can get all nostalgic for the good old days of San Diego craft beer, but Constellation isn't snatching up Ballast Point with the intent to dilute Sculpin into some watered down Pilsner. The product will still exist, and still be premium priced. And without way more in its arsenal, I'm not sure how Constellation will use Ballast Point to force retailers to carry weaker brands at the expense of others. Trust me, the grocers and big boxes are already selling tons of Corona and Modelo.

Bemoaning the current trend of quality craft brewers selling out is akin to tilting at windmills. Again, times have changed.

 

Agreed. So rather than bemoaning the sellout trend (who can blame them for taking that kind of money?), I'm trying to shift the onus back to the consumer. If you want quality and variety, spend your money on suppliers of quality and variety. But if someone is blatantly adversarial to the "quality and variety" segment of your industry, why would you help fund their activities?

 

Im trying to figure out how they're lumped in with AB/MC too. They've only been a beer business for 2-3 years, granted they're huge in wine/spirits. People with the $/resources would of surely jumped at the opportunity to of acquired the modelo portfolio when AB had to give it up. Just don't see the cause of panic, constellation hasn't gone big beer route with lobbying to try to stomp out craft ($320k spent lobbying '14, $230k this year vs millions from AB/MC). They're lumped in with macro in terms of volume, but unlike the domestic macros that have been losing share, they're sitting back while their brands are gobbling it up.

 

Perhaps Constellation will be a big supporter of craft brewing - who knows? But this is part of a larger pattern that does involve AB/MC - and they generally have not shown themselves to be supporters of "craft".

 

I'm guessing Dr. Evil suggested the $$$ amount

 

You are free to become rich beyond your dreams in America! I love it! I am free to never buy a sell out beer again. Bless this f^ckIn beautiful country!!!!!

 

Herehttp://mexiconewsdaily.com/news/constellation-invest-1bn-nava-brewery/ is an interesting story about Comstellatio 's expansion of the Nava brewery dating back to this spring.

That's a lot of hectoliters of capacity. That's also a lot of ambition, to go from 7% of US volume to 14%. Wonder if they might be planning to make some Ballast Point beers down there?

Notice that bit about expansion by Heinekin, at the end? Some of that could be Lagunitas production, I would think.

 

At least Green Flash didn't buy them and screw up the recipe for Sculpin...

 

I have had far too many good micro brews tonight to contribute in a coherent fashion to this discussion/argument... That being said Stone Brewing Co just keeps looking better. Stick to your core values and F*** the status quo!!! Complacency = subservience. And that's my 10 oz's for this topic.

 

I think they can get the volume up there for sure. With the pricing the way it's been the last 4 or 5 years, coronas been steadily growing, and modelo is increasing market share, times double digits year over year. The big 3 would have annual price increases and grupo modelo (pre ABI) wouldn't. That pricing difference probably would of been first order of business had abi kept those brands here. At stores, the bud light/coors light 12packs kept creeping up towards the import prices of 12s, then the trading up started. Latino market are a big chunk of bud light sales and it's been steadily bleeding to corona and modelo. Latino population is set to keep growing, the sales will come with it.

I see some more BP breweries popping up, east coast or the south type. Not sure the level of distribution BP currently has or had, but know it's been increasing. So, need more production capability because I'm sure the near future it'll be everywhere. (As said in earlier post, constellation has "that guy" that's able to call on buyers and get the product where it's not already or increase it's offerings)