Anheuser-Busch Buying Seattle Craft Brewer Elysian

ST. LOUIS (St. Louis Post-Dispatch/TNS) -

Anheuser-Busch is bolstering its craft-beer portfolio once again by acquiring a growing craft brewer, Seattle’s Elysian Brewing Co.

A-B said it’s buying Elysian and its four brewpubs in Seattle for an undisclosed amount. The acquisition is set to close by the end of the first quarter.

Elysian produced more than 50,000 barrels last year.

Elysian’s biggest seller is Immortal IPA, which accounts for a fourth of its total volume. Its beers are sold in some overseas markets and 11 U.S. states: Washington, Alaska, Colorado, Oregon, Idaho, Montana, Pennsylvania, New Jersey, Maryland, Delaware and New York.

Elysian’s owners say the acquisition by A-B will enable additional growth.

“With the support of Anheuser-Busch, we will build on past successes and share our beers with more beer lovers moving forward,” Elysian co-founder and CEO Joe Bisacca said in a statement. Bisacca, Dick Cantwell and David Buhler, who founded Elysian in 1995, will continue to work at the brewery.

A-B, whose U.S. headquarters are based in St. Louis, said Elysian will become part of its high-end portfolio.

“Elysian’s story includes everything we look for in a partner … As the fastest growing brewer in Washington, their recipe is working. Elysian’s brands are an important addition to our high-end beer portfolio, and we look forward to working together,” Andy Goeler, CEO of A-B’s craft unit, said in a statement.

A-B already has an ownership stake in Pacific Northwest breweries. A-B is a part owner of the Craft Brew Alliance, a holding company that owns Seattle’s Redhook Ale Brewery and other breweries, including Widmer Brothers Brewing and Kona Brewing Co.

In recent years, A-B has made several acquisitions of craft brewers, including its $38.5 million purchase of Goose Island in Chicago in 2011. After acquiring Goose Island, A-B expanded the beer nationwide and internationally.

Last year, A-B also acquired Patchogue, N.Y.-based craft brewer Blue Point Brewing and 10 Barrel Brewing, which is based in Bend, Ore.

Craft-beer sales accounted for between 10 and 11 percent of beer sold domestically at the end of last year, up from 7.8 percent in 2013, according to the Brewers Association, an industry trade group.

As demand grows, A-B is seizing the opportunity to grow its craft-beer portfolio while mainstream beers such as Budweiser lose market share, said Brewers Association director Paul Gatza.

“The big brewers have realized that this is where the American public is heading toward — full-flavored, craft-brewed beer,” Gatza said, adding that he expects more acquisition activity in the coming year.

There are more than 3,200 craft breweries nationwide, up from 2,768 in 2013, according to the Brewers Association, which defines craft brewers as independent and traditional brewers that produce 6 million barrels or less of beer annually.

“Certainly, the deals have started to accelerate,” Gatza said. “I think that’s to be expected when there are so many more players than there used to be.”

Some craft-beer fans took to social media Friday to bemoan the sale, pointing out that Elysian’s Loser Pale Ale has denigrated “corporate beer” on its packaging.

But Harry Schuhmacher, publisher of industry trade publication Beer Business Daily, said the acquisition by A-B won’t negatively affect sales. “There’s always a backlash, of course, but history has shown that it doesn’t seem to affect demand,” he said, pointing out sales growth at Goose Island since 2011. “You can complain all you want about A-B, but they know how to make beer. Stainless tanks are stainless tanks, and the quality and consistency (at A-B) is the same or probably better.”

Elysian’s status as a regional brewer with brewpubs fits with A-B’s acquisition strategy, Schuhmacher said. “That means that A-B wants to deal directly with the consumer and they want to learn from the bar/on-premise scene,” he said. “They want to take what they learn and apply it to the rest of their business. It’s very strategic, which is very typical of A-B.”

For consumers, an upside to the sale is that Elysian beers may be easier to find, he said. “Elysian is a regional brewery, and A-B can take it national practically overnight.”