Labatt to Purchase Popular Canadian Craft Brewer

Labatt and Mill Street Brewery announce purchase agreement

The craft deals keep coming, this time north of the border. Labatt Breweries of Canada, a subsidiary of Anheuser-Busch InBev, today announced it has acquired Toronto’s Mill Street Brewery.

Terms of the transaction were not disclosed.

According to a press statement, the deal will allow Mill Street, based in Ontario, to “deepen its traction with consumers” in Canada’s fast-growing craft beer segment, which grew 7 percent in 2014, according to market research firm NPD Group.

Labatt said it plans to immediately invest $10 million in new state-of-the-art brewhouse and packaging capabilities.

“Our partnership and investment will accelerate its growth in one of the most dynamic beer segments, while fully preserving Mill Street’s creative character and pioneering spirit,” Labatt president Jan Craps said in a statement.

Founded in 2002, Mill Street is Canada’s largest brewer of certified organic beer and makes over 70 different styles.

“Throughout our history, our dedication to our craft and our passion for pushing the envelope have allowed Mill Street to make waves in Canada’s craft beer segment,” Mill Street co-founder Steve Abrams said in a statement.  “We are excited about the prospect of working with Labatt to build even further on our successes and sharing our brands with more beer lovers across Canada.”

In addition to flagship Original Organic Lager, Mill Street’s core brands include 100th Meridian Amber Lager, Tankhouse Al.e, Cobblestone Stout, and Stock Ale, a golden export-style.

Mill Street products will continue to be brewed under the supervision of brewmaster Joel Manning, Labatt said in the statement.

“This investment in a state-of-the-art brewhouse that Mill Street will run on a stand-alone basis positions us to reach the very top of our craft,” added Manning.  “We couldn’t be more pleased by this fantastic opportunity to further entrench our reputation for innovation and quality, and bring more great brands to more consumers.”

Similar to trends in the U.S., small brewers in Canada are growing faster than their larger counterparts. According to statistics compiled by Beer Canada, a trade group representing the nation’s beer makers, Ontario-based companies producing fewer than 100,000 hectoliters (85,200 barrels) annually grew sales by more than 28 percent in 2014. Those same companies also accounted for about 11 percent of the region’s total beer production.

Total output in the region, meanwhile, declined 10 percent last year and production from breweries making more than 100,000 hL annually declined 13 percent.