New Jersey’s largest craft brewery has struck a deal to acquire one of the state’s oldest.
Cape May Brewing announced today it will acquire Flying Fish Brewing Company in Somerdale, New Jersey. Financial terms of the deal, which is set to close next month, were not disclosed.
“This is a massive milestone for both Cape May and Flying Fish, who we’ve long admired as a true pioneer of craft brewing in the Garden State since its founding in 1995,” Cape May CEO and co-founder Ryan Krill said in a press release. “We are thrilled to expand our product portfolio and are approaching this acquisition with a focus on our core values, passion for brewing, and commitment to serving our customers with the highest quality brews.”
Following the acquisition, Flying Fish will maintain its existing distribution relationships in New Jersey, Pennsylvania, Delaware and Maryland, according to the release. Notably, Cape May operates its own distribution arm, Cape Beverage Distributing.
Flying Fish is listed in the portfolios of New Jersey distributors High Grade Beverage, Kohler Distributing, Kramer Beverage, and Shore Point Distributing.
With this “strategic investment,” Cape May will boost its manufacturing and warehouse space “significantly,” according to the release.
Flying Fish moved to its current facility in 2012, according to a Philadelphia Eater report. The brewery’s production capacity is 25,000 barrels annually “with room to grow,” a Cape May spokesperson told Brewbound.
In 2021, Flying Fish’s volume declined -13%, to 16,688 barrels, down from its five-year high of 19,250 barrels in 2020, according to the most recent data available from the Brewers Association (BA).
Gene Muller founded Flying Fish in the mid-1990s as “the world’s first virtual microbrewery,” according to the brewery’s LinkedIn page. At the time, New Jersey’s craft beer scene included a fraction of the 141 craft breweries operating in the state today, according to the BA.
Muller sold his shares of Flying Fish in 2018, a Cape May spokesperson confirmed. The current owner is Pennsylvania-based Elk Lake Capital, a family-owned private equity firm helmed by CEO James Lewandowski. Elk Lake’s investments include two environmental service firms and Times-Shamrock Outdoor, an out-of-home advertising company in Pennsylvania’s Luzerne County.
Both breweries will retain their management teams for the foreseeable future, according to the spokesperson.
“Both companies will continue to be led by their existing leadership teams during the due diligence process to analyze the existing structure and anticipate future needs,” the spokesperson said.
Cape May produced about 43,000 barrels in 2022, a decline of around -5%, president Frank Stempin told Brewbound in January.
This year, Cape May has expanded its distribution in Pennsylvania, pushing beyond its presence in the greater Philadelphia area to the counties surrounding Pittsburgh, Scranton and Harrisburg through a combination of Molson Coors-aligned distributors. In addition to Pennsylvania, Cape May also ships to Delaware via Standard Distributing Co.
Cape Beverage Distributing carries the brewery’s portfolio statewide in New Jersey, as well as several other brands. The wholesaler’s portfolio includes offerings from Philadelphia-based Dock Street Brewery; Fresno, California-based Full Circle Brewing and several beyond-beer brands such as Hard Rock Hard Seltzer and Expert Cocktails, Fishtown Iced Tea, Biza Lightly Sparkling Island Cocktail and Stewart’s Spiked.
For its own beyond-beer portfolio, Cape May has shifted its focus from hard seltzer to tea- and lemonade-centric flavored malt beverages (FMBs). Cape May Hard Iced Tea and Hard Lemonade rolled out earlier this month in the brewery’s taproom with distribution to the full Cape May footprint to follow.
Editor’s note: this story was updated at 6:30 p.m. ET on April 24 to include additional information about Flying Fish’s wholesaler network, brewing capacity and ownership status.