Consolidation Continues: Reyes Beverage Group to Acquire Windy City Distribution

Consolidation in the middle tier continues as Reyes Beverage Group announced Sunday that it would acquire Windy City Distribution, currently based in Warrenville, Ill.

Press materials received by Brewbound.com did not disclose the official terms of the acquisition, but industry publication Beer Marketer’s Insights – which reported the news late last Friday evening– said the deal could be worth “well over $50 million.”

Windy City Distributors sells well-known craft brands like Lagunitas Brewing, Stone Brewing Co. and Oskar Blues Brewery and is owned by brothers Jim and Jason Ebel. The Ebels also started the Warrenville craft brewery Two Brothers Brewing Company in 1996.

Molly Reilly, a spokesperson for Reyes Beverage Group, confirmed to Brewbound.com that it will operate Windy City separate from its other wholesaler in the market, Chicago Beverage Systems. She said the two companies will not share any trucking or warehouse space.

It’s not yet known if any of Windy City’s current 44 craft beer and cider suppliers will look to realign their distribution interests but Reilly said Reyes is “optimistic” that all brands will remain with Windy City. Windy City president Bob Collins is reportedly working with suppliers to ensure a smooth transition.

The Reyes Beverage Group includes the above-mentioned Chicago Beverage Systems, Crest Beverage, Florida Distributing Company, Gate City Beverage Distributors, Harbor Distributing, Lee Distributors, Chesbay Distributing Co. and Premium Distributors of Maryland, Virginia and Washington DC. Some of those wholesalers distribute for the country’s most notable craft brands, including the three largest – Boston Beer Company, Sierra Nevada and New Belgium – among others.

It’s the 34th distributor acquisition this year, and comes on the heels of an announcement last week that J.J. Taylor Minnesota would acquire Chisago Lakes Distributing. It also follows news that Wirtz Beverage Illinois will enter the craft beer market in 2013 with its first craft brand, Deschutes Brewery, the country’s fifth-largest craft brewer.

The transaction is expected to close before the end of the year. The complete press release is below.

CHICAGO - Reyes Beverage Group announced an agreement, early Friday evening, to acquire the assets of Windy City Distribution Company. The transaction is expected to close before the end of the year.

Windy City Distribution represents over 40 craft breweries and artisan Cider Companies in Chicago and across 8 counties in northern Illinois. Reyes Beverage Group will operate this business, independent of Chicago Beverage Systems and its other distributorships, as Windy City Distributing, L.L.C. Bob Collins will join Reyes Beverage Group as the President of Windy City Distributing, along with his current management team including Wes Phillips, maintaining a high-end craft beer portfolio sold by Certified Cicerone sales representatives.

Ray Guerin, Chief Operating Officer of Reyes Beverage Group, said, “Windy City Distributing will be a new entity in our network focused solely on the craft beer market. I look forward to working with Windy City to learn more about servicing the craft beer industry while providing Reyes Beverage Group’s expertise to help Windy City expand in this exciting and growing category of craft specialty beers.”

Bob Collins, President of Windy City Distribution Company said. “We have a great portfolio of specialty beers paired with the most beer passionate craft beer representatives in the industry while operating in one of the best craft beer markets in the country. We’re thrilled that joining Reyes Beverage Group as an independent operation provides continuity for our supplier partners, our customers and our culture while bolstering our operation with additional resources.”