Breakthru Beverage Group has signed an agreement to acquire Wine Warehouse, a California-based beer, wine and spirits distributor.
The deal is expected to close this spring. At that time, Wine Warehouse will integrate its “resources and capabilities” with Breakthru to “enhance service to partners and grow the California market,” according to a press release.
Financial details of the deal were not disclosed.
“We intend to make significant investments and be a competitive force in the market,” Breakthru president and CEO Tom Bené said in the release. “Breakthru has built a consistent and scalable business that makes us a very attractive partner to both suppliers and customers nationwide. We will bring a consumer-led approach as we unite the expertise of the California team with the culture, scale and capabilities that Breakthru can provide to grow the business.”
Wine Warehouse – a “multi-generational, family-owned and -operated” distributor with headquarters in Los Angeles and Richmond, California – has been in operation since 1973, and is now the third-largest wholesaler in California, and a top 10 wholesaler in the U.S., according to the release.
“The dynamics of the industry are changing and the momentum we have makes this an ideal time to begin the next chapter with Breakthru,” Wine Warehouse chairman and CEO James P. Myerson said in the release. “We know they will invest in growing the business, bring innovations to the market and use their strong relationships and expertise to distinguish us among both the suppliers and customers we serve.”
“We are committed to maintaining the existing strong leadership team in California and have the utmost confidence that they will continue to deliver as a strong marketplace option on behalf of our supplier and customer partners,” Bené added.
Wine Warehouse’s beer portfolio includes craft offerings from Allagash, The Bruery, BrewDog, Lost Coast, Almanac, and Mother Earth, and European imports Stiegl, Paulaner, Bitburger and Unibroue.
The deal marks Breakthru’s first flag planted in California, where it previously did not operate any distributors. Middle-tier consolidation has been a near ever-present issue in California, where the California Family Beer Distributors trade group formed to represent the interests of independent wholesalers in the wake of heightened acquisitive behavior by the Reyes Beer Division.
Breakthru’s U.S. footprint includes Arizona, Nevada, Colorado, Missouri, Illinois, Wisconsin, Minnesota, Florida, South Carolina, Virginia, Maryland, Delaware and Pennsylvania. In addition to those states, Breakthru affiliate Connecticut Distributors, Inc. operates in Connecticut. Breakthru has nationwide distribution in Canada.
The multistate wholesaler employs more than 7,000 people across 36 facilities in North America.
Breakthru has made several deals in recent years. In January 2022, Breakthru announced the planned acquisition of Major Brands in Missouri. In March, Breakthru acquired J.J. Taylor Companies’ beer business in Minnesota. In August 2020, the wholesaler acquired the rights to the Miller portfolio in Nevada from Bonanza Beverage, as well as the rights to Lakeshore Beverage’s beer and cider portfolio in Illinois.
In 2021, Breakthru tapped Bené, then the president and CEO of the National Restaurant Association, to serve as CEO. In December, the company announced the appointment of Julian Burzynski as Breakthru’s first chief operating officer, and the promotion of Kevin Roberts to a “newly designed” chief commercial officer role. Both appointments went into effect January 1.
Breakthru’s deal for Wine Warehouse is the second wholesaler transaction of 2023. Earlier this week, Arizona-based Anheuser-Busch InBev distributor Hensley Beverage struck a deal for Premier Distributing, a fellow A-B house, in New Mexico, Beer Business Daily reported. The acquisition will add around 7.5 million cases to Hensley’s business.