Newburyport Brewing Company Invests in Rhode Island Contract Outfit

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Newburyport Brewing Company today announced an investment into Isle Brewers Guild, a $12 million Rhode Island-based craft brewing cooperative currently being built in Pawtucket.

Newburyport is the second craft beer company to invest in the Isle Brewers Guild (IBG), which aims to attract mid to large-scale craft breweries in need of extra capacity; in April, Narragansett Beer also said it would invest an undisclosed sum into the venture.

Both ‘Gansett and Newburyport are minority partners in IBG and, together, the two companies plan to occupy a bulk of the brewery’s initial 60,000 barrel capacity.

In a conversation with Brewbound, Newburyport Brewing founders Chris Webb and Bill Fisher said an investment into IBG, which will eventually be capable of producing 150,000 barrels annually, would provide much needed capacity to expand the business.

“Newburyport is running at 100 percent capacity right now,” Fisher said, noting that the company would brew and package just over 15,000 barrels in 2016. “There is no more space left. We needed a way to keep growing and a way to meet demand in our current markets. The more we talked with IBG, the more it seemed evident that we wanted to be involved in this.”

Construction at IBG — which is situated in a 130,000 sq. ft. facility and features a 100-barrel brewhouse, packaging lines, a tasting room, outdoor event space and offices — is nearing completion, Fisher said, and brewing is slated to begin in early 2017.

Fisher believes the new facility could add as much as 15,000 barrels to the Newburyport business in 2017.

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As part of its investment into IBG, Newburyport will “get more of a say in brewery operations, what’s being brewed and quality control,” Fisher added, noting that the company will also be allowed to occupy office space at the new brewery.

“From a margin perspective, it’s not like what we are making here in Newburyport,” said Fisher, who explained that his company will still pay a per barrel fee in exchange for access to the space.

“But from a partnership and investor perspective, it is better than if it were just straight contract,” he added.

As a result of the partner brewing arrangement, Newburyport, which raised $245,000 in mid-2015, according to an SEC filing, will now be able to invest those funds and future capital into sales and marketing instead of expensive brewing equipment.

And as it prepares to begin producing beer in Rhode Island, Newburyport has also inked an agreement with C&C Distributors for coverage throughout the state. The company’s Green Head IPA, Plum Island Belgian White, Newburyport Pale Ale, Melt Away Session IPA, Das Kölsch and 1635 Series offerings will be available in Rhode Island in mid-October, according to a press release.

It has also hired two new sales representatives.

The company is also considering additional expansions into Connecticut, New York, Maine and Vermont in 2017, the founders said.

“This partnership with IBG will allow us to add new territories, but we don’t have any concrete plans; we still want organic, smart growth,” Webb added.

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