Ale Asylum permanently closed last week after 16 years, after a planned sale of the brewery failed to come to fruition, the Madison, Wisconsin-based brewery announced on its website and social media channels Friday.
“Friends, family, villains, and heroes: We began with a dream and a bag of hops in May of 2006,” the company wrote. “Since then, we’ve grown into a big family of brewers, cooks, bartenders, service staff, marketing, sales, and more. The past couple years have been difficult for all businesses but with your support we were able to weather the storm. However, under circumstances we cannot control, we have made the decision to close our doors.”
Ale Asylum – the 12th largest brewery in Wisconsin, according to production estimates from the Brewers Association (BA) – was meant to continue with new ownership this year, the company announced in October. However, “after months of diligence” the deal fell through, as the “acquiring party was simply unable to attain the financing necessary” to complete the sale, Otto Dilba, brewery co-founder and VP, told Brewbound via email.
News that Ale Asylum was seeking new ownership was announced in August 2021, with an auction of the brewery’s assets – including a 30-barrel, 5-vessel brewhouse – scheduled for October, organized by New Mill Capital, an asset disposition firm. Dilba, who also serves as secretary and treasurer, told Brewbound at the time that he hoped for a turnkey acquisition of the company.
Things seemed to be headed in the right direction in October, when an initial acquisition proposal by an undisclosed group of buyers – described by Dilba as “local entrepreneurs, with some other businesses in the area” – was accepted, and scheduled to close by the end of 2021. The sale would have allowed Ale Asylum’s production and operations – including its 45,000 sq. ft. taproom and restaurant – to continue uninterrupted.
Additionally, all Ale Asylum staff – cut from about 50 employees to 20 during the COVID-19 pandemic – would have kept their positions, including Dilba and co-founder, president and brewer Dean Coffey.
“They understand the importance of community and taking care of their staff and guests,” Dilba said of the ownership group, at the time. “On a personal and professional level, their goals and forward thinking align very well with ours.”
Dilba and Coffey are now “fielding other inquiries and may move forward with an auction of the equipment in the very near future.”
“The equipment is in pristine, like new condition, American made with U.S. stainless steel,” Dilba said. “It’s been all but hand polished with diapers since the beginning.
“As for myself and Dean, we’re working on finalizing things on the back end,” he continued. “We are not sure what’s next but we’re proud to have been a part of the craft beer community for so many years and the relationships established over that time.”
At its peak, Ale Asylum produced an estimated 22,734 barrels in 2015, according to the BA. After several years of production declines, the company lost its regional brewery status in 2019, when it produced 12,950 barrels of beer. Things were looking up in 2020, when the brewery increased production +15% to 14,921 barrels, but fell again in 2021, when production declined -40% to 9,007 barrels, according to the BA’s May/June issue of New Brewer Magazine.