In an effort to diversity its portfolio of beverage offerings, American Brewing, a Washington-based, publicly traded craft beer company, has announced the acquisition of a fast-growing kombucha brand.
As reported earlier this week by BevNET (the sister site of Brewbound), the brewery purchased Búcha, a brand of certified organic sparkling kombucha drinks, from B&R Liquid Adventure, LLC for a combination of $260,000 cash, a $140,000 note payable and $500,000 in American Brewing restricted stock.
In a news release, American Brewing CEO Neil Fallon said the acquisition “falls in line perfectly with our strategy of acquiring profitable, existing assets and revenue streams with large footprints and merging them into the American Brewing Company family of beers and beverages.”
Búcha is currently sold in major health and grocery chains on the West Coast, including Safeway, Kroger, Whole Foods and PCC, according a release detailing the acquisition.
Like craft beer, sales of kombucha, a fermented tea beverage, are growing rapidly.
“The commercial Kombucha industry continues to expand quickly via double digit growth each year,” according to Hannah Crum, head of the Kombucha Brewers International trade association. “The entire category is on pace to surpass $500 million in yearly sales by 2015.”
The acquisition was a way for American Brewing to play in the space, said Fallon, but he also expects the purchase to help boost the primary beer business.
“They currently have about three times our annual sales, so this does a lot of things in terms of moving our company forward as a whole,” Fallon told Brewbound. “It’s a little bit of a complex issue, but it is our intention to leverage the success of one to help the other, if you will.”
Beyond bringing in a product that already has a strong distribution footprint, Fallon said the company is interested in blending its beer and kombucha products as an innovative way to expand its sour program.
“It’s not currently being done, so this has the potential, the possibility of being something that can be really popular,” added Fallon. “It could also fall flat on itself and go nowhere. But hey, we want to try to be innovators.”
While kombucha-beer hybrids remain niche, there are a handful of companies exploring such offerings. Michigan’s Unity Vibration and New York’s Beyond Brewing Co., are two companies exclusively focused on creating low-strength kombucha and kombucha-beer products.
American Brewing sold approximately 3,500 barrels of beer in 2014, primarily in Washington State but also in South Carolina and internationally in Canada and Japan.
According to BevNET, American plans to retain a “handful” of Búcha employees, most notably, technical director and brewmaster, Frank Commanday, who has in the past worked for craft beer companies including Sierra Nevada and Widmer Brothers.
American Brewing will also look to remain an active acquirer of both alcoholic and non-alcoholic beverage companies, Fallon said.