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On Thursday, it was announced that the Boston Beer Company (makers of Samuel Adams, Angry Orchard Ciders and Sel Selzer's TRULY brand, among others) would merge with Delaware's Dogfish Head Brewery. A joint press release estimated the transaction at approximately $ 300 million in cash and shares; The shares of the BBC (stock symbol: SAM, of course) have climbed by about 5% since the announcement.
Some people will tell you that craft beer is not like other businesses. Boston Beer Company Founder and President Jim Koch and Dogfish Head co-founder Sam Calagione are two of them. They believe that brewers should be run by "brewers first and businessmen," and that corporate independence – as defined by the Brewers Association, a professional group on whose board they both served – is an essential part of authentic craft beer. .
But, while the number of American breweries exceeds 7,400, the macrobrassers have proved that they can buy and exploit craft brands without facing the public revolt. Consolidation, not creativity, is the buzzword in the beer industry nowadays. In other words, instead of looking like the "weirdest and happiest economic story in the United States," craft beer is starting to look like another business.
Having covered the beer space for most of the decade, I interviewed Koch and Calagione several times. Taking into account the hurried state of the craft beer industry, I again contacted the two men by phone as they were traveling from a press event to Eataly, New York City, New York. Dogfish Head Brewery, Delaware.
This interview has been slightly modified for clarity and brevity.
Thrillist: Jim and Sam, thank you for being on the phone. Congratulations for the agreement.
Jim Koch: We are in the car here.
Sam Calagione: A lot of noise from the road.
Koch: If you hear rattling in the background, you can imagine what that is.
Calagione: The carrot on the stick at the end of our trip!
Pleasant. I'm in Asheville, North Carolina right now. I want to start by asking a question that concerns many people, or at least mine. How is this deal different from a macrobrewer such as ABI who acquires a craft brewery like Wicked Weed?
Koch: It's totally different. Two independent craft brewers join forces. This is not a big global brewing conglomerate that buys a small American brewer. Secondly, Sam and I have always been strong advocates for transparency and believe that beer drinkers have the right to know who's brewing their beer. We both had problems with the big breweries that buy craft breweries without letting the consumer talk about it. We intend to do like Boston beer with our innovative breweries like Angel City, Concrete Beach and Coney Island. We are very proud to put Boston Beer Company on [their labels] as a brewer. We are also proud to have our name on Dogfish Head beers. They feel the same thing.
Calagione: We are very proud to be independent craft brewers and, fortunately, this is not a subjective concept. Our professional group, the Brewers Association, which represents the vast majority of the 7,500 American craft brewers, has the definition of independent craftsmanship, and we are proud to do so. We also have a seal that only real independent craft brewers can affix to their packaging. Our companies believe in this seal because we believe that consumers want to know who makes their beer. And when we think that a lot of consumers will be proud to buy beer made by a real independent American brewery and that they are able to place our beers from coast to coast in the three-tier system.
How much did you consult the Brewers Association during the conclusion of this agreement?
Koch: We did not have to, because Sam and I sat on the board of the Brewers Association.
Calagione: Although we did not consult with the Brewers Association, I had an excellent conversation yesterday with Executive Director Bob Pease, who sees another example of the community's creativity and collaborative ethic. brewing.
[In a statement provided to Thrillist, BA president & CEO Pease said: “As industry veterans, Jim and Sam are staunch supporters of the independent beer movement, leading the charge for small brewers and instrumental in growing the overall craft brewing segment […] They will undoubtedly continue to defend more than 7,400 small independent breweries in the United States.]]
So, the trade group is excited. What about customers? If I'm a thirsty Dogfish Head drinker or a Sam Adams fan, why should I be excited about it?
Calagione: I'm going to start. In a word. Accessibility. This will increase the accessibility of our two portfolios. At the national level, it is very difficult to act when four international conglomerates control more than 80% of the beer market in America. It's hard for little guys to overcome that noise and pass on our brands to the consumer, no matter how much [the consumers] the desire. Well now, with our combined scale or combined creativity, we are a combined network of, uh, distributors. We can put this beer more easily in the hands of consumers.
Koch: This brings together breweries with a long tradition of innovation and creativity. And I know from experience that when you bring together creative people, cool things happen that might not happen if they innovate in their separate silos.
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