San Francisco’s Magnolia Brewing has been purchased by Colorado’s New Belgium Brewing Company for $2.7 million. It’s part of a bankruptcy proceeding reports the Chronicle, who broke the news of the sale. Magnolia has been operating as usual since owner Dave McLean filed for Chapter 11 in 2015.

At the time, McLean remained optimistic about the state of the brewery, saying "We just have a lot of debt, and our operations are profitable, but not profitable enough to cover our debt service." By filing for bankruptcy protection Magnolia was able to stay open and potentially pay back creditors over time. New Belgium founder Kim Jordan told the Chron that it’s a “sweet opportunity for Dave, for us, and for the craft brewing community,” citing a long friendship with McLean and the company as part of the deal. Magnolia’s two brewpubs — Smokestack in Dogpatch and Magnolia in the Haight — will continue to operate as usual. Oud Beersel, a Belgian brewery, is also involved in the deal which New Belgium says could result in new lambic-style beers from Magnolia down the road.

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It’s not quite as scary as the purchase of a San Francisco icon by an international company, but it is a big leap for Magnolia: New Belgium produces around one million barrels per year at breweries in Ashveville, NC and Fort Collins, CO, while Magnolia has a combined capacity of 37 barrels at its two SF brewpubs. It’s also probably the best case scenario for the company, which was both profitable and deep in debt at the time McLean filed for bankruptcy. McLean will become an employee of the brewery, working alongside new head brewer Dick Cantwell (founder of Elysian Brewing).