With Funky Buddha Purchase, Constellation Shifts Acquisition Strategy to ‘Local Brands’

Posted by: Timothy A Nemeckay Publish Date: Aug 18, 2017

Ales Beers Ciders
With Funky
Buddha Purchase,
Constellation Shifts
Acquisition Strategy
to ‘Local Brands’
MSB Would Fit Perfectly
In This Strategy

Constellation Brands has acquired fast-growing Florida-based craft beer producer Funky Buddha and, in the process, formed a new “High End Craft and Specialty” business group specifically tasked with overseeing the company’s present and future craft brewery purchases.

Financial terms of the deal, which closed yesterday, were not disclosed. The structure is similar to Constellation’s 2015 all-cash purchase of San Diego’s Ballast Point Brewing, which was worth $1 billion, Brewbound understands. A sale price was not disclosed, but the deal is for 100 percent of the company, according to KC Sentz, who co-founded the brewery with his brother Ryan Sentz.

“We felt Constellation was definitely the right company to take the torch and run with it, and build Funky Buddha into the brand both of us always hoped it could be on a scale that we felt that we couldn’t get it to,” he told Brewbound. “To me, there’s no better company in the alcohol space that builds brands like they do.”

And now that Constellation Brands owns craft breweries on both U.S. coasts, the company – which also owns a variety of wine and spirits labels — has opted to split its beer division into two separate units.

Craig Farlie, a managing director with Farlie Turner & Co., who advised Funky Buddha on its sale to Constellation, echoed Hetterich and said the Fort Lauderdale-area craft brewery wasn’t “shopping” for a buyer.

“Their phone has rung a bunch over the last 24 months,” he said. “They are fast-growing and have quality liquid. Funky Buddha is located in the third largest state in the country – one that is incredibly under-indexed in craft beer — so this provides Constellation great access to this market.”

Farlie added that by acquiring a craft brewery in Florida, which is a popular vacation destination, Constellation would have a better chance of delivering a brand that resonates with customers along the eastern seaboard, should the company look to expand distribution of Funky Buddha beers.

(EXCERPT Brewers Association). For the complete story and infographic visit: www.brewbound.com/news/funky-buddha-purchase-constellation-shiftsacquisition-strategy-local-brands

Late Summer Days
On The Beach
With MSB Make
For Fun Times
Cold Spring Brewing
Company Sold to
Private Equity Firm

Minnesota-based Cold Spring Brewing Company has been acquired by Brynwood Partners, a Connecticut-based private equity firm with existing investments in a variety of food and beverage companies.

A purchase price was not disclosed and the transaction – which includes Cold Spring’s Third Street Brewhouse and Monarch Custom Beverages divisions — was finalized on August 3, Brynwood managing director Dario Margve told Brewbound.

In addition to brewing its own line of craft beers under the Third Street Brewhouse label, Cold Spring has made products for companies such as Pabst Brewing, 21st Amendment and Boulevard Brewing, among others. The 143-year-old company also produces flavored malt beverages and copacks a number of non-alcoholic beverages, including soft drinks, sparkling waters, teas and energy drinks (most notably, Monster Energy).

In a press release, Brynwood said Cold Spring generates more than $60 million in revenue annually and employs 350 people. According to Margve, Cold Spring’s beer division is “growing double-digits” but is a “smaller piece of the overall business.”

Brynwood, which describes itself as a “lower middle market buyout fund that acquires consumer products companies,” has raised over $1.1 billion across seven funds since it was founded in 1984. Four of those funds are still active, according to its website. The Cold Spring purchase is part of the company’s seventh, $420 million fund – Brynwood Partners VII L.P — which includes investments in Juicy Juice, Sunny Delight and Daily’s Cocktails, which are anchored under the Harvest Hill Beverage Company rollup.

(EXCERPT Brewers Association). For the complete story and infographic visit: www.brewbound.com/news/cold-spring-brewing-company-sold-private-equity-firm

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This communication(1) is furnished on a confidential basis and may be used only by the intended recipient without reproduction or further transmission, (2) is not an offer to sell or a solicitation of any offer to buy securities and (3) contains “forward-looking statements,”which may differ materially from actual events and should not be given undue reliance.