Lion continues expansion in US

Kirin-owned Lion has continued its US expansion with its US-based New Belgium Brewing entering an agreement to buy a production brewery from Constellation Brands to increase production of its Voodoo Ranger line.

Kirin acquired New Belgium, at the time the fourth-largest craft brewery in the US, in 2019 through its Lion-owned Little World Beverages.

US industry news site Brewbound reports this acquisition will add 125,000 barrels (14.6 million litres) capacity to New Belgium.

Brewbound also noted that Reuters reported in December 2022 that Kirin was seeking additional brewing capacity in the U.S. for additional production of the Voodoo Ranger brands, quoting Kirin CEO Yoshinori Isozaki as saying “our craft beer business in North America is on a roll”.

Since acquiring New Belgium, the company has seen significant growth of its Voodoo Ranger line.

IRI off-premise data showed New Belgium Brewing Company “recorded the largest sales growth among traditional beer brand families (+22.9%, to $429 million)” in the US in 2022.

Lion initially acquired its US breweries, which includes the 2021 acquisition of Bell’s, through Little World Beverages. Following a business review, Little World Beverages has now become one of Lion’s three business units – Lion AU, Lion NZ and Lion USA.

Lion craft in Australia

Its US growth is a rare recent success in craft for Lion which, by contrast, in Australia this week announced the closure and end of the Tiny Mountain brand.

The Townsville-based brewery was launched with the hope of incubating the local brand. Despite becoming a popular local venue, the Tiny Mountain brand failed to flourish.

The former Little World Beverages attempts to take Little Creatures global failed, with its London, Singapore and Hong Kong Little Creatures-branded venues closed, and San Francisco rebadged to New Belgium.

The company has also retreated from craft in the UK, selling off Magic Rock and Fourpure, which it acquired in 2019.

The Little Creatures brand itself, acquired in 2012,  has been largely stagnant in Australia. Numerous brand refreshes have failed to capitalise on the craft pioneer’s early growth or reignite the highly regarded beer’s brand. Little Creature’s Furphy offshoot has plateaued despite strong marketing backing.

Lion sought to rejuvenate its craft portfolio with the 2021 purchase of Australia’s then-largest independent brewery, Stone & Wood, for a reported $500 million.  Lion AU has not reported on growth for that brand

Lion’s sluggish performance in craft in Australia raises questions around the company’s craft strategy locally, though Kirin’s most recent financial reports predict the company will see 20 per cent  growth in the craft beer category in 2023, without providing insight into its plans.

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New Belgium Brewing to Acquire Production Brewery in Daleville, Va., from Constellation Brands

With no brands included, expansion will help America’s fastest-growing craft brewer meet demand

(Daleville, Virginia – March 23rd, 2023) – Today, New Belgium Brewing announced an agreement to acquire Constellation Brands’ 259,000 square foot production brewery in Daleville, Va. This agreement pertains to the facility itself and will include offers for continued employment by New Belgium for all current employees, but the
acquisition does not include any brands. The deal is expected to close in early May.

The acquisition will expand New Belgium’s existing production capacity to help meet growing demand for its industry-leading craft beer portfolio – including Voodoo Ranger, America’s #1 IPA brand family. Upon completion of the deal, New Belgium – the largest and fastest-growing U.S. craft brewery – will immediately commence brewing at Daleville, focusing on Voodoo Ranger Juice Force IPA (the top U.S. craft beer launch of all time in 2022) and its high-velocity 2023 sequel Fruit Force IPA.

The transaction will also deliver strong benefits to the community, ensuring the continued operation of the stateof-the-art Daleville facility. All of Daleville’s approximately 60 workers will be offered a seamless transition to New Belgium employment at equal or greater pay than before. A certified B Corporation, New Belgium’s compensation package – which includes a $20 per hour internal minimum wage, benefits like annual profit-sharing, high quality health insurance, paid sabbaticals at 10- and 20-year anniversaries, and more – will bring an immediate positive impact to Daleville.

“For a company growing as fast as New Belgium, there’s no challenge more urgent than boosting our ability to make enough beer to meet growing demand,” said New Belgium CEO Steve  Fechheimer. “We’re excited to join the Daleville community, and we’re confident this facility and its local team will help us fuel our growth for the foreseeable future. We greatly appreciate the partnership we’ve seen from distributors and retailers over the past several months as we’ve worked to find a solution.”

As part of the deal, New Belgium and Constellation Brands will enter into a co-packing agreement, under which New Belgium will manufacture select brands for Constellation at Daleville, including the recently launched Fresca Mixed, among other select beer brands. In the future, New Belgium will explore ways to leverage the facility’s FMB, seltzer, and RTD capabilities, which provide new avenues to expand the company’s legacy of innovation. There are no current plans to operate a taproom at Daleville.

“One of the keys to our success is bringing a focused and disciplined approach to our beer business, making key strategic pivots when the circumstances warrant it,” says Jim Sabia, President of Constellation Brands’ Beer Division. “We are pleased that New Belgium Brewing will be able to more fully optimize the Daleville facility’s footprint and are confident they will position the existing talented workforce for additional future success.”

The Daleville brewery was purpose-built in 2017 with multi-category production capabilities across beer, FMB, seltzer, and spirits-based/wine-based RTDs. The site is located in the greater  Roanoke area, strategically located near the I-81/I-64 interchange – and just a four-hour drive from New Belgium’s existing production brewery in Asheville, N.C.

With a longstanding commitment to investing in communities, New Belgium donates $1 per barrel of beer sold to support social and environmental causes – especially those close to home. New Belgium leaders will be getting acquainted with the community in and around Daleville and expanding the company’s grants program to support positive impact in the region.

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