Sapporo-Stone Brewing Co. unveiled a $60 million expansion plan yesterday that will double the company’s annual capacity to about 700,000 barrels.
The news comes less than two years after Japanese beer giant Sapporo acquired Stone Brewing, then the seventh-largest independent craft brewery in the country, for $165 million. Post-integration, the joint company has 850 employees, 600 of whom are based in San Diego County.
The new capacity will be spread across the company’s breweries in Escondido, California and Richmond, Virginia. The first phase of the expansion, valued at $20 million, is nearly complete, according to a press release. Part of the first phase included the addition of 200 new jobs, 125 locally and 75 outside of San Diego County. Additionally, “more than 150 team members have been promoted or moved into new or expanded roles since the acquisition,” according to the release.
“Operationally, this acquisition looks a lot like a merger,” Sapporo-Stone interim CEO Zach Keeling said in the release. “Our two companies are now fully integrated – innovating, brewing, selling, marketing and operating as a single, combined business. The Sapporo and Stone Brewing brands will maintain their individual identities, but we are Sapporo-Stone in name, operations and culture.”
Keeling was given the interim CEO role in January, following the departure of Maria Stipp, who had held the position at Stone for more than three years. Keeling previously served as chief financial and strategy officer. Stipp was named CEO of Suja Life, a organic juice and shot company, in February.
“It is a bittersweet moment,” Stipp said at the time of her departure. “Unlike many acquisitions, we have the privilege of keeping our leadership team intact. This has allowed us to fully integrate and build a future where Sapporo and Stone are indeed better together. It’s been really challenging, fulfilling and exciting.”
Other additions from the expansion project include additional tanks and packaging lines for both increased capacity and efficiency, according to the release.
Sapporo-Stone was the 12th-largest brewer by volume in the U.S. in 2023, according to estimates from the Brewers Association. Initial reports had Sapporo-Stone ranked No. 19, but rankings were updated on April 17, according to the BA website. Sapporo-Stone aims to make it into the top 10, according to the latest press release. Specific production numbers for 2023 have not yet been released by the BA.
With the Sapporo acquisition, Stone no longer meets the BA’s definition of a craft brewery, and so it no longer makes the trade group’s Top 50 craft brewery list. If the company was included, it would rank No. 10, below Monster Brewing (previously named CANarchy) and above non-alcoholic beer maker Athletic Brewing.
Sapporo-Stone chairman Hiro Kitaoka spoke at an Open House event in Escondido yesterday, stating: “Stone Brewing is among the world’s most recognizable and celebrated craft breweries. We admire the team’s innovative spirit, passion, and world-class brewing expertise. We are proud to continue the legacy of Stone and honored to have this full team’s commitment to the Sapporo brand. We are stronger together, and proud to be a growing San Diego business.”
Sapporo was the No. 1 Asian beer brand in the U.S. in NIQ-tracked off-premise channels (total U.S. xAOC + convenience) in the 52-week period ending April 27, increasing dollar sales +13.1%, according to the company. The company attributes the majority of that growth to Sapporo Premium.
Stone’s core three beers – Stone Delicious IPA, Stone IPA and Stone Buenaveza Salt & Lime Lager increased dollar sales +13.2% in the same 52-week period, according to the company.
It appears that much of that growth is from extensions of the Stone Delicious brand family. In the last 26 weeks (ending April 20), Stone IPA – the company’s leading brand – recorded declines in both dollar sales (-3.5%) and volume (-6.3%) in all NIQ-tracked off-premise channels (total U.S. xAOC + liquor plus + convenience). Stone Delicious IPA (dollar sales -2.3%, volume -4.6%) and Stone Buenaveza Salt & Lime Lager (dollar sales -19.1%, volume -23.4%) were also in the red.
Brewbound managing editor Jess Infante spoke with Keeling earlier this year about the company’s portfolio focus, as well as the discontinuation of its hard seltzer and canned cocktail offerings. Brewbound Insiders can read the full story here.