Norwood, Massachusetts-based Castle Island Brewing Company has acquired the intellectual property (IP) of Cambridge Brewing Company (CBC).
The deal closed Tuesday, three days before Cambridge Brewing was set to cease operations. Financial details of the transaction were not disclosed. Carved out of the deal is CBC’s Kendall Square pub, which will close December 20 as planned.
In August, CBC founder Phil Bannatyne announced plans to wind down operations after 35 years, permanently close the brewpub and retire. (Hear more from Bannatyne on the decision on the Brewbound Podcast.)
Castle Island founder and CEO Adam Romanow told Brewbound that talks with Bannatyne began shortly after the announcement.
“Beyond the emotional components – which I don’t need to explain to anybody in the industry – I think the brand’s got a lot of legs,” he said. “They make phenomenal beers that should not just be put in a filing drawer for the rest of eternity.
“The Cambridge name has some provenance, some equity, can travel – which is not something we intend to do immediately, but hopefully down the road – there’s demand for it,” he continued. “More than anything, we just didn’t want to see it get shuttered.”
CBC and Castle Island had a prior working arrangement. Castle Island has been producing Cambridge’s flagship distributed offerings – Cambridge Amber and Flower Child IPA – since March. Those beers and more will be available in Castle Island’s taprooms in Norwood and East Boston sometime in Q1 2025.
“Long term, we’d like to increase the size of the portfolio, but do it in a mindful, controlled way,” Romanow said. “[CBC brewmaster] Will [Meyers] is obviously leaving behind a ton of incredible, incredible beers that, again, don’t deserve to be locked away forever.
“Maybe we break some of those out and brew them in the taprooms. Maybe, eventually, they make it onto taps or shelves. But right now, we’re just focused on what’s out there, which is Amber and Flower.”
Romanow doesn’t expect any interruption to the distribution of the beer through its legacy wholesaler partner in Massachusetts, Sheehan Family Companies. Although Cambridge has distribution agreements statewide in Massachusetts, the brand’s footprint is largely in the Cambridge, Somerville and Boston area.
“We want to make sure there’s no interruption of supply,” Romanow said. “Everyone who can get Cambridge today can get it a week from today, and we’re feeling pretty good about our ability to deliver on that.”
There is no overlap in distributors for CBC and Castle Island, which will put the company in competing houses across the Bay State. Castle Island is with Burke, Atlas, Colonial and Merrimack in the Molson Coors network and then in the western part of the state with Quality/Martignetti and Girardia.
“There’s already going to be enough disruption with the brewpub closing in Kendall [Square],” Romanow said. “We don’t want to add any more complexity to it.”
CBC produced 1,387 barrels last year, according to data from the Brewers Association (BA). For 2025, Romanow said Castle Island is maintaining modest expectations for CBC due to industry headwinds. He’s forecasting CBC’s distributed volume to be flat to possibly “up a little bit,” although he’s optimistic that Castle Island’s sales and marketing team can help uplift the brand.
Nevertheless, the priority in Year One will be not alienating CBC’s fan base, Romanow said.
“It’s preserving the legacy of a brand that really laid some of the earliest bricks of craft beer in the greater Boston area, and a brand that we don’t want to see go away,” he added.
Castle Island produced 8,500 barrels of beer in 2023, a -9% year-over-year decline, according to the BA. Romanow expects the craft brewery to be down a few points by year’s end due to “tough comps” created by rationalizing its lager brand in favor of its light lager and lower volumes for speciality releases, while on-premise volume held steady.
Going into its tenth year, Romanow is projecting Castle Island to be flat to up as it focuses on its core offerings following a year in which the company added a new year-round beer in Winner IPA, a variety 12-pack of 12 oz. cans, 19.2 oz. single-serve cans of Keeper IPA Hi-Def double IPA and a brand refresh.
“I’d be lying if I said we weren’t feeling a little bit of whiplash after all of that,” he said. “And so the theme for next year is focus.”
Keeper IPA remains Castle Island’s top offering, accounting for 60% of its distributed volume and its top-selling beer in its three largest distributors, accounting for 85% of the brewery’s sales in those houses.
Castle Island expects a bump in its contract brewing business next year as Boston-based Dorchester Brewing has backed away from its contract business to focus on its own brand. Romanow said the brewery has received a lot of inbound interest and has added three new contract clients to its roster of around 15 brands.
Castle Island could grow its production volume by up to +40% with additional capacity for contract brewing, he added.