New Belgium Brewing to be acquired by Australian beverage giant Lion for undisclosed sum

Mackensy Lunsford | The Citizen-Times

Show Caption Hide Caption New Belgium Brewing Company sold: A look at Colorado brewer's history The Fort Collins-based craft brewing giant may no longer be locally-owned after the November announcement of its possible acquisition.

New Belgium Brewing will no longer be employee-owned by the close of the year.

Pending approval by regulators, the Employee Stock Ownership Plan and other closing conditions, Lion Little World Beverages should acquire 100% of New Belgium in an all cash transaction by the end of the year.

The Fort Collins, Colorado-based brewery, known for its flagship Fat Tire amber ale, was established in 1991 and added an Asheville expansion in 2016. Rumors almost immediately began swirling about the brewery being for sale, though company officials swatted them down. New Belgium laid off 28 employees between its headquarters and the Asheville location last year.

New Belgium CEO Steve Fechheimer would not disclose the financial terms of the sale, though he did say that, with the addition of a new bottling line, staff numbers are likely to grow at the Asheville brewery.

"(Though) we're currently 100 percent employee owned, after the transaction we will be completely owned by Little World," Fechheimer told the Citizen Times via phone from Fort Collins. "This is an opportunity for employees who have been part of New Belgium to realize the benefits of ownership."

That opportunity will come in the form of cash, New Belgium founder Kim Jordan explained in a release.

"More than 300 employees are receiving over $100,000 of retirement money with some receiving significantly greater amounts," she said. "Over the life of our ESOP, including this transaction, the total amount paid to current and former employees will be nearly $190 million."

"And this is the amazing reality of the business and company Kim set up, and the way she envisioned the company," Fechheimer said. He said the brewery employs just more than 700 people between both locations.

After the transaction, New Belgium Brewing headquarters will remain in Fort Collins, and Fechheimer will continue as CEO, with the management team remaining in place.

Jordan will remain involved with the company, and also play a key advisory role in collaborating with leading founders within the Lion Little World Beverages network, according to her statement.

What is Lion Little World? Kirin?

Lion Little World Beverages is the global craft beverages business of Lion, headquartered in Australia and owned by Kirin Holdings Company Limited, a Japan-based company that counts both the beverage business and the pharmaceutical business among its top enterprises.

Kirin owns a minority stake in Brooklyn Brewery and owns Four Roses Distillery outright. Lion Little World Beverages was first established as ‘Lion Global Markets’ in 2015 and entrusted with leading Kirin’s global craft beer strategy in new market expansion outside Japan, Australia and New Zealand.

Its portfolio includes James Squire, Little Creatures, Emerson’s and Panhead. It also launched pioneering Australian craft brand Little Creatures in the U.S., UK and Asia, recently adding UK craft brands Fourpure and Magic Rock to the family.

More: New Belgium Brewing sale: Who will be Fat Tire maker's new owner?

"This is a great day for us, and we're very proud to be sitting here in Fort Collins with Kim and Steve," said Matt Tapper, head of Little World's global markets divisions.

"New Belgium, put simply, is a significant stake in the ground for us in the U.S., the largest craft beverage market in the world. We're looking forward to working with the New Belgium team and, over time, to create and build an even better craft beer business."

The Brewers Association, a not-for-profit trade group representing small and independent craft brewers, ranked New Belgium as the fourth most productive brewery in the U.S., based on beer sales volume, behind D. G. Yuengling & Son, Boston Beer Co. and Sierra Nevada Brewing Co.

More: As New Belgium gets ready to sell, take a look back at the brewery's history

Tapper also said that the brewery's status as a B-Corp, which means it is legally required to consider the impact of decisions on workers, customers, suppliers, community and the environment, was an attractive factor in the decision to acquire New Belgium. New Belgium will retain its B-Corp status.

"There's a clear articulation of a strategy to be a force for good," Tapper said. " And from a Little World point of view, that's something we think about."

Lion announced last week a pledge to make all Australian and New Zealand breweries in its portfolio carbon neutral, starting in 2020.

"We feel culturally incredibly aligned," Tapper said.

What about the employees? The brand?

Tapper said there are no immediate changes expected to the brand's beer portfolio, nor jobs to be cut. "We want to continue to invest in those brands, and build on them and grow."

Fechheimer said New Belgium's distribution footprint already covers the entire U.S. and a handful of international markets. He did not expect much to change in that realm.

"We are continuing to invest in the Asheville brewery, where we're in the process of adding a canning line. North Carolina is growing and doing well, and it's a brewery we're excited to keep investing in."

"Clearly we're going to be focused on growth from both the Fort Collins and the Asheville point of view; nothing would delight us more," Tapper said.

But the immediate future, he added, will primarily be about all parties getting to know each other.

"It will mean us learning from the best of New Belgium and hopefully New Belgium learning from the best of Little World, and we'll raise the bar together," Tapper said.