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Anheuser-Busch InBev just sold off eight of its beverage brands to Tilray Brands, one of the largest players in Canada’s legal cannabis industry.
Tilray just announced that it had struck a deal to buy Blue Point Brewing Company, Square Mile Cider Company, Shock Top, Breckenridge Brewery, 10 Barrel Brewing Company, Redhook Brewery, and Widmer Brothers Brewing from AB InBev earlier this week. The deal, which is reportedly valued at around $85 million in cash, also includes the HiBall Energy drink brand. Full details about the acquisition have yet to be released, but Tilray expects the deal to close by the end of 2023.
“Today’s announcement both solidifies our national leadership position and share in the US craft brewing market and marks a major step forward in our diversification strategy,” Tilray Chairman and CEO Irwin D. Simon said in a statement. “We are excited to work with the teams behind these iconic brands that command great consumer loyalty and have a history of delivering strong award-winning products with tremendous growth opportunities.”
As part of the deal, Tilray will also acquire all of these brands’ employees, breweries, and brewpubs. This will give the cannabis company control of four major beverage production facilities – two in Oregon, one in Colorado, and one in New York. For now, the company will keep its weed and booze businesses separate, but Simon said that he intends to develop THC-based beverages as soon as the US government gets around to federally legalizing weed.
AB InBev is best known for mainstream American beers like Budweiser and Busch, but it has also invested heavily in the craft beer market. The company launched a few of its own craft-style beer brands, like Shock Top, and acquired several others during the 2010s. But beer sales have been declining steadily since then, so InBev execs decided to liquidate some of their craft beer acquisitions. And Tilray was happy to step up and help lighten their load.
Millions of dollars have changed hands between the alcohol and cannabis industries in the past decade, but most of these transactions involved booze companies investing in weed startups. Constellation Brands, maker of Corona beer and Svedka vodka, invested $191 million into Canadian cannabis giant Canopy Brands in 2017 and dumped another $4 billion into the company the following year. Molson Coors Canada also bought up a majority share in another Canadian pot company, the Hydropothecary Corp., that same year.
Tilray has been moving in the opposite direction, though. Before the current deal, the cannabis giant had already acquired several major craft beer brands, including SweetWater Brewing Company, Montauk Brewing Company, Alpine Beer Company, and Green Flash Brewing Company. The AB InBev transaction is expected to triple the size of Tilray’s beer arm, which will make the company the 5th-largest craft beer producer in the entire US.
