Crossover Event: Beavertown & Heineken

Heineken sign

Beaver­town has sold a sub­stan­tial stake to Heineken  – they’re not spec­i­fy­ing how much but 49 per cent seems a rea­son­able assump­tion – and our Twit­ter men­tions have gone a bit mad.

That’s because a few weeks ago, you might recall, we wrote a piece reflect­ing on signs one might look out for to indi­cate that a brew­ery is ready­ing itself for sale, point­ing to Beaver­town as an exam­ple of a firm that seemed to be glow­ing hot.

Now, let’s be clear: our post was actu­al­ly pret­ty ten­ta­tive – might this, pos­si­bly that – and, though we named AB-InBev as a pos­si­ble suit­or in the quick Tweet we fired off before the post, we did­n’t spec­i­fy any names in the post prop­er because we did­n’t have a clue.

Even if we’d guessed Heineken would have been low down the list giv­en its fair­ly recent acqui­si­tion of anoth­er Lon­don brew­ery, Brix­ton.

(Although with­in min­utes of our post­ing mul­ti­ple peo­ple had mes­saged us to say, “It’s Heineken”, and prop­er jour­nal­ists soon fer­ret­ed out the sto­ry.)

So, yes, we’re feel­ing pleased that our log­ic was test­ed and seems to have held up but, no, we don’t feel like sooth­say­ers or a pair of Mys­tic Megs. What we came up with was half edu­cat­ed guess, half luck.

In the PR around today’s news Beaver­town has addressed a few impor­tant points head on, admit­ting to hav­ing swerved telling the truth because (as we acknowl­edged in our post) busi­ness­es don’t gen­er­al­ly talk about deals while they’re being nego­ti­at­ed and, indeed, are usu­al­ly legal­ly pro­hib­it­ed from doing so:

It’s been an uncom­fort­able few weeks as spec­u­la­tive rumours have been fly­ing about.  The real­i­ty is that some­times in busi­ness you can’t share every­thing and I’m a true believ­er in not talk­ing about any­thing unless it is a done deal, and up until this very day there was no deal.

It’s at this point, though, that we’ll refer to an even old­er post of ours, from May last year: brew­eries could avoid a lot of the crit­i­cism and high emo­tion that hits on takeover day, and lingers for months and even years after, if they made a point of say­ing from much ear­li­er on in the cycle some­thing like, “We some­times talk to poten­tial investors and would nev­er rule out sell­ing a stake in the com­pa­ny, just so you know.”

Peo­ple will prob­a­bly under­stand if you have to keep the specifics of par­tic­u­lar deals qui­et, as long as the very idea that you might be talk­ing to whichev­er glob­al giant isn’t a nasty sur­prise.

What­ev­er the logis­tics behind the deci­sion, how­ev­er good the news for the com­pa­ny, regard­less of whether the beer stays the same, there will always be peo­ple who feel stung when a com­pa­ny which was sell­ing a set of val­ues as much as pale ale decides that one of those val­ues does­n’t mat­ter any more.

Getting in Shape for Takeover

Reading tea leaves in a cup.

Without insider intelligence it’s impossible to say with any certainty whether a brewery is about to be taken over by a larger national or multi-national but we reckon there are a few things to look out for.

First comes a shift from purism to prag­ma­tism. Small­ness, inde­pen­dence and prove­nance, once both sacred val­ues and sell­ing points, get dropped.

There might be sur­pris­ing part­ner­ships with ‘evil’ com­pa­nies; there may be con­tracts to sup­ply super­mar­kets; or plans to have beer pro­duced under con­tract, with more or less trans­paren­cy.

This kind of thing usu­al­ly comes with a rush of blurb explain­ing how, actu­al­ly, this way is even crafter because it widens access to the prod­uct, chal­lenges the sta­tus quo, and so on, and so forth. But what it also hap­pens to do is send a sig­nal like ani­mal hor­mones in mat­ing sea­son: we’ve grown up now; we under­stand how it works in the real world; we’re peo­ple you can do busi­ness with.

The tying off of loose ends is anoth­er thing to watch out for, e.g. the sud­den set­tling of legal dis­putes, which few poten­tial buy­ers will want to acquire as part of any bun­dle. Cam­den set­tled their dis­pute with Red­well over the trade­mark for Hells, for exam­ple, at around the time of its takeover by AB-InBev. (We under­stand that report­ing of this news came much lat­er than the set­tle­ment itself, though it’s pos­si­ble we’ve got the wrong end of the stick.)

Along the same lines, one might read some­thing into the wind­ing up of fun but mar­gin­al parts of the busi­ness.

The emer­gence of a dom­i­nant beer in the port­fo­lio might be the biggest red flag of all. (Or green, depend­ing on your point of view.) Big multi­na­tion­al firms are drawn to lagers, pale ales, wheat beers and increas­ing­ly, we’ve observed, ses­sion IPAs. These are prod­ucts with main­stream appeal, that peo­ple can and will drink for an entire ses­sion or buy by the six-pack, and which fill a gap in their port­fo­lios of Craft Brands. If they’re already in super­mar­kets and chain pubs (see above) all the bet­ter.

All of this is a round­about way of say­ing that, think­ing back on the tra­jec­to­ries of Mean­time, Sharp’s, Cam­den and oth­ers, we’d put mon­ey on Beaver­town being bought up before too long.

Of course Beaver­town says this:

Twitter conversation: a takeover is not going to happen, says Beavertown.

But that does­n’t change our gut instincts. After all, the one indi­ca­tor of an impend­ing takeover you can guar­an­tee you’ll nev­er get is any explic­it announce­ment of intent before a deal has been finalised.

News, Nuggets & Longreads 14 April 2018: Beer Duty, Beavertown, Baudelaire

Here’s all the writing about beer from the past week that most engaged, informed or entertained us, from the Fall of the Craft Beer Empire to Gamma Ray in Waitrose.

Well, most of the past week – we wrote this post at break­fast time on Fri­day and sched­uled it to post, so if any­thing excit­ing hap­pened on Fri­day after­noon, we prob­a­bly missed it. We are now on hol­i­day for a week and a bit which means no round-up next week­end. If you want a fix of links in the mean­time check out Stan Hierony­mus’s Mon­day post and Alan McLeod’s on Thurs­day.


Adapt­ed from ‘The End is Nigh’ by Jason Cartwright on FLICKR, CC BY 2.0

We’ll start with a piece by Pete Brown which prods at the kind of would-be sen­sa­tion­al news sto­ry based on a piece of research you have to pay to read in full:

Have you noticed a decline in the demand for craft beer? Why do you think this is?”

I stared at the ques­tion, cog­ni­tive dis­so­nance mak­ing me feel momen­tar­i­ly floaty.… The rea­son I was con­fused is that it hasn’t hap­pened – not yet. When I got these ques­tions, I’d just deliv­ered the keynote speech to the SIBA con­fer­ence. To write it, I’d had to do a lot of dig­ging. I’d dis­cov­ered that craft beer vol­ume increased by 23 per cent last year, and that ana­lysts are pre­dict­ing con­tin­ued growth until at least 2021. I’d learned that busi­ness lead­ers in the food and bev­er­age indus­try had named craft beer the most impor­tant trend across the whole of food and drink – com­fort­ably ahead of low alco­hol drinks, arti­san cof­fee and craft spir­its – for the fifth year run­ning.

Con­tin­ue read­ing “News, Nuggets & Lon­greads 14 April 2018: Beer Duty, Beaver­town, Baude­laire”

News, Nuggets & Longreads 16 September 2017: Beavertown, Burials, Biggsy

Here’s everything beer- and pub-related that caught our eye in the last week, from viking funerals to mysterious pressure groups.

Con­tin­ue read­ing “News, Nuggets & Lon­greads 16 Sep­tem­ber 2017: Beaver­town, Buri­als, Big­gsy”

Infantile?

Label for Partizan X ale w. crossed dinosaurs.
Art by Alec Doher­ty. SOURCE: Par­ti­zan Brew­ing Archive.

We’re working on an article about mild in the 21st century, research for which prompted this statement in an email from Andy Smith at Partizan:

The beer was orig­i­nal­ly sim­ply called mild… We then decid­ed to rebrand as X… This worked OK but not as well as we’d hoped. It was at this stage we put dinosaurs on the label and sales rock­et­ed! I kid you not. It sells as well if not bet­ter now as our oth­er dark beers. Dinosaurs! Now we spend our week­ends hear­ing how cute the dinosaurs are (recent­ly changed) and  answer­ing the ques­tion what is X?

That’s fun­ny, of course, but also made us think, ‘Huh. So craft beer drinkers are like chil­dren?’

We’ve observed before, as has almost every­one else who’s writ­ten a tedious think-piece on the sub­ject, that craft beer in cans has been suc­cess­ful part­ly because they are tac­tile and colour­ful, bright and toy-like. Beaver­town Brew­ery’s car­toon-laden designs in par­tic­u­lar sug­gest mate­r­i­al for an (admit­ted­ly slight­ly weird) ani­mat­ed series and also make them look like a bit like soft drinks. (Gam­ma Ray more so than this exam­ple we have at hand.)

Beavertown Smog Rocket design.
Art by Nick Dwyer. Source: Beaver­town Brew­ery.

And some­times, with fruit and resid­ual sweet­ness and nov­el­ty flavour­ings and high­er car­bon­a­tion, the hippest beers can taste a bit like soft drinks too.

Of course we checked our­selves fair­ly prompt­ly: one per­son­’s infan­tile is, of course, anoth­er per­son­’s fun, and we under­stand that you humans enjoy this emo­tion fun is good.

And even if it is infan­tile, is that a bad thing? One key rea­son peo­ple drink is to reduce the pres­sures of adult life and the pub is where grown-ups go to play.

This is a ques­tion we’re going to have in mind from now on, though, espe­cial­ly when we find our­selves con­sid­er­ing the gen­er­a­tion gap between real ale cul­ture and craft beer. (Def 2.)