Tilray continues to invest in two of our favorite things — weed and craft beer. Considering the former, Tilray is a pioneer in the research, cultivation, production and distribution of cannabis and cannabinoids. Since its establishment in 2013 as a private equity firm in British Columbia, the company has made strides to advance the acceptance and understanding of cannabis in medical and recreational spheres. In 2014, Tilray became one of the first companies to be licensed by Health Canada to produce medical cannabis, marking a significant step in the Canadian cannabis industry’s development. Recognizing the potential for medical cannabis worldwide, Tilray began exporting its products to various countries and was one of the first North American producers to export medical cannabis to Europe, Australia, New Zealand and South America.
Recently those cannabis roots have expanded into craft beer. In 2021, another Canadian cannabis company called Aphria acquired Tilray in a reverse merger and rechristened the expanded business as Tilray. Aphria had bought SweetWater Brewing Co. back in 2020 for $300 million, and today SweetWater is under the Tilray umbrella. Late in 2021, Tilray bought SoCal’s Alpine and Green Flash brands along with Breckenridge Distillery in Colorado. Last year, Tilray headed to the Northeast, adding Montauk Brewing Co., which bills itself as the No. 1 craft brewer in Metro New York. Now…
Tilray Brands Inc. has closed its previously-announced all-cash acquisition of eight famous craft beer and beverage brands from Anheuser-Busch, including the breweries and brewpubs associated with them. The acquired businesses include Shock Top, Breckenridge Brewery, Blue Point Brewing Co., 10 Barrel Brewing Co., Redhook Brewery, Widmer Brothers Brewing, Square Mile Cider Co. and HiBall Energy. Through this transaction, Tilray Brands is expected to become the fifth largest craft beer business in the United States — up from the No. 9.
From the press release:
Ty Gilmore, President, Tilray Beer, [said], “We are incredibly excited to welcome these iconic brands and the teams behind them to the Tilray Beer business. These brands command great consumer loyalty and have a history of delivering strong award-winning products with tremendous growth opportunities. Tilray is fully committed to invest in and champion the future of the U.S. craft beer industry by fueling innovation and by reinvigorating our marketing, to excite and further accelerate the growth of our consumer base and drive new opportunities of growth and profitability for Tilray and our distributor partners.”
This isn’t the first time Tilray and A-B have worked together. AB InBev and Tilray announced a research partnership focused on non-alcohol THC and CBD beverages way back in 2018. Similarly, Tilray’s continued move into the craft beer industry is both strategic and timely. Tilray’s current exposure in the U.S. market consists of CBD products and alcohol, but soon the company hopes to bring weed and beer together in new forms in the United States, noting 23 states have legalized the drug for recreational use and another 13 have legalized it for medicinal purposes. From BNN Bloomberg last month:
“I’m buying these brands too because I think there’s a big opportunity in the beer business and my whole strategy is craft beer,” Irwin Simon, chairman and CEO of Tilray Brands, told BNN Bloomberg in a television interview. “Upon legalization (in the U.S.) one day, we will infuse these drinks with THC, with CBD, but we’ll have the distribution and we’ll have the brands when and if legalization does happen.”
Recognizing that cannabis and alcoholic beverages appeal to similar demographics, Tilray is nicely aligned to offer a variety of social lubricants — craft beer, NA beer, cannabis products and soon cannabis- and CBD-infused beers. It’s already stretching its beer distribution arms. Tilray just announced in September that two of its best-selling craft beer brands — Montauk Brewing and SweetWater Brewing — are now available at the Atlantis resort on Paradise Island in the Bahamas and will be available soon at additional locations across the Caribbean. This year alone, Montauk has expanded distribution to surrounding states in Connecticut, New Jersey, Rhode Island and then down South in Georgia.
SweetWater, Green Flash and Alpine Beer announced availability in Nevada earlier this year. In fact, SweetWater’s portfolio of popular hop-forward beers, brews like SweetWater’s 420 Extra Pale Ale, Green Flash’s West Coast IPA and Alpine’s Duet IPA, are now available in more than 1,000 points of distribution across 44 states, including the following retailers: Costco, Lee’s Liquor, Walmart, Safeway, Whole Foods Market, Albertsons, Vons, Trader Joe’s and Target. We can probably expect expanded distro for these new brands as well.
From the press release:
Irwin D. Simon, Chairman and Chief Executive Officer, Tilray Brands, said, “Tilray Brands’ portfolio today reflects our diversified business and the integration of key strategic acquisitions that have enabled us to grow our top line and deliver substantial cost savings through synergies, all while significantly expanding distribution to coveted markets across the U.S. and internationally. With this EBITDA accretive transaction, Tilray has acquired a stellar lineup of eight craft beer and beverage brands that both solidify our leadership in the craft beer industry and strengthen our business in the expansive beverage sector in which we see tremendous opportunity to reinvigorate innovation across many categories including non-alcoholic beverages, energy, and nutritional drinks. Together with our best-in-class team, I am confident that we will successfully integrate our current beer assets with these newly acquired brands and businesses to set the stage for higher growth.”
Now, let’s break down this transaction a little further. First off, why are these eight new brands a good move for Tilray?
The transaction strengthens and solidifies Tilray’s leadership position in craft brewing
- Established brand portfolio with loyal consumer base and growth upside from synergies and expanded capabilities in alcohol and non-alcoholic beverages
- Projected to generate craft beer pro-forma revenue of $250 million
- Strengthens distribution footprint nationwide
- Triples Tilray’s beer sales volume from four million cases to twelve million
Modern facilities and operations will fuel innovation and commercial growth opportunities
- Four production facilities across the U.S.: Portland, OR, Bend, OR, Littleton, CO and Patchogue, NY
- Eight vibrant brewpub locations: Seattle, WA, Bend, OR (2), Portland, OR, Boise, ID, Littleton, CO, Breckenridge, CO, and Patchogue, NY
- Provides additional manufacturing capacity and innovation capabilities for commercial expansion opportunities
- Identified synergies across procurement, logistics and supply chain to reinvest profitability into growth drivers
Let’s breakdown these eight iconic brands
- Shock Top is an award winning traditional Belgian-style wheat ale that was originally introduced in 2006 as a seasonal offering. After taking home the gold medal at the North American Beer Awards in the Belgian White category, it became a year-round offering. Shock Top Belgian White is a spiced wheat ale brewed with coriander spice and the peels of three different citrus fruits: orange, lemon, and lime. This uniquely crafted ale is unfiltered to create a naturally cloudy brew with a light golden color and a smooth, refreshing finish. Shock Top also has a seasonal line-up that excites consumers every year, led by Twisted Pretzel Wheat, delivering delicious taste and aroma of bakery-fresh pretzels.
- Blue Point Brewing Company was founded in 1998 by two friends who wanted to bring local craft beer to Long Island. Today, Blue Point has grown into one of the largest breweries in New York State, offering a lineup of easy-drinking and innovative craft beers. Its product portfolio includes Toasted Lager, Hoptical Illusion, Imperial Sunshine, Pinstripe Pils, as well as a rotating line of Innovation Beers. Blue Point has won numerous awards over the years that highlight the quality of innovation at forums such as the World Beer Cup, the Great American Beer Festival, the New York Craft Beer Competition, the Australian International Beer Awards, and the Atlantic City Beer Festival.
- Breckenridge Brewery opened its doors in 1990 in the ski town of Breckenridge, Colorado and has grown into one of the most recognized craft breweries in the U.S. Today, Breckenridge Brewery has two locations to visit – the original brewpub in Breckenridge and its renowned Farm House restaurant in Littleton, CO, outside Denver. With a focus on balanced, approachable, and interesting beer, the brewery’s portfolio includes Avalanche Amber Ale, Palisade Peach Wheat, Juice Drop Hazy IPA (India Pale Ale), Funslinger Lager, Vanilla Porter, Hop Peak IPA, Juice Drop Imperial Hazy IPA, Strawberry Sky, Mountain Beach Session Sour, Agave Wheat, Palisade Peach Light, Nitro Vanilla Porter, Nitro Irish Stout, and Christmas Ale (seasonal). In 2022, Breckenridge Agave Wheat won a Bronze medal in the American Wheat Beer category at the Great American Beer Festival.
- 10 Barrel Brewing Company was founded in 2006 in Bend, Oregon by a team who shared one simple mindset: brew beer, drink beer, and have fun doing it. Today, 10 Barrel boasts an award-winning team of brewers and has four brewpub locations: Bend West (Bend, OR), Bend East (Bend, OR), Portland, OR and Boise, ID. 10 Barrel is one of the most acclaimed breweries in the U.S., winning a gold medal at the 2022 Great American Beer Festival in the Specialty Berliner-Style Weisse category and a bronze medal in the German Sour Ale Category. 10 Barrel is consistently a top medal winner at the Oregon Beer Awards. Its products include Apocalypse IPA, Nature Calls, Profuse Juice, Rock Hop IPA, All Ways Down, Club Tread Mandarin IPA, Pilsner, Pub Beer, and Cucumber Crush. 10 Barrel took home three Gold and one Silver medal at the 2023 World Beer Cup.
- Redhook Brewery, founded in Seattle, Washington, is one of the nation’s original craft breweries, crafting better beer since 1981. Four decades later, one thing has never changed—Redhook is still brewing great beers. Its award-winning beers include Big Ballard Imperial IPA, Hazy Big Ballard Imperial IPA, Tropical Big Ballard Imperial IPA, Storm Surge Hazy IPA, Lagersquatch Lager, and Long Hammer IPA. Redhook Brewlab opened in 2017 in the heart of Seattle’s Capitol Hill neighborhood. It has an 8-barrel brewing system where consumers can taste the latest experiments. In 2023, Redhook launched its Big Ballard IPA Variety Pack, the industry’s first Imperial Craft 18pk.
- Widmer Brothers Brewing, founded in Portland, Oregon in 1984, is one of the largest craft breweries in the Pacific Northwest. In 1986, Widmer Brothers introduced its Hefe beer, an American variant on the traditional Hefeweizen, which spread widely across the country. In the 2023 Best of Craft Beer Awards, Hefe won Gold in the American Wheat category and Widmer Brothers was awarded “Large Brewery of the Year”. Its award-winning beers include Hefe, Drop Top Amber, Deadlift Imperial IPA, Hopcadia NW IPA, Cold Waters Cold IPA, Juicy Sunrise IPA, and Green Skies Hazy IPA.
- Square Mile Cider Company, launched in 2013, offers ciders made with pure Pacific Northwest apples and lager yeast to create a perfectly crisp, clean, and semi-dry hard cider. Its offerings include Original Hard Cider, Rosé Apple Cider, Peach Lemonade Cider, Raspberry Lemonade Cider, and Imperial Blackberry Pie.
- HiBall Energy was founded in 2005 as a clean energy seltzer made with zero sugar, zero calories, and organic caffeine. HiBall’s products have included Grapefruit, Watermelon Mint, Wild Berry, Black Berry, Lemon Lime, Peach, and Vanilla – all crafted with a proprietary, organic-certified energy blend, consisting of caffeine, guarana, and ginseng.
In addition to Tilray Brands’ craft beer portfolio, Tilray also owns Breckenridge Distillery, the award-winning spirits brand and the World’s Best Blended Whisky, Truss Beverage Co. non-alcoholic cannabis-beverages, and Happy Flower CBD sparkling non-alcoholic cocktails.
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