Anheuser-Busch InBev is back in the craft beer M&A game.
After a two-year hiatus following the May 2017 acquisition of Wicked Weed, the world’s largest beer manufacturer announced today the acquisition of Cleveland’s Platform Beer Co., a transaction that is expected to close in the third quarter.
Speaking to Brewbound, Platform co-founder Paul Benner said the Ohio craft brewery began “exploring different investment mechanisms” about six months ago in an effort to continue the company’s upward growth trajectory.
Ultimately, Benner said he and co-founder Justin Carson were attracted to the “autonomy and independence” A-B provides the founders in the daily decision making of its acquired craft brands.
“As we became more educated on what that partnership actually looks like, it became more and more clear this was the best option for us for the short-term and the long-term as a company,” he said.
Selling to A-B will also provide Platform with additional resources to upgrade its facilities and provide its employees with additional benefits — such as improved medical, dental, vision, 401K match, and parental leave — and other professional development opportunities, Benner said.
“We want to have a place that people love to work,” he added. “These are really important cogs in that, and we’ve never been able to offer some of those resources, and now we can.”
Marcelo “Mika” Michaelis, president of A-B’s Brewers Collective, told Brewbound that the A-B was attracted to a combination of Platform’s geographical location, its founders, their “data driven” strategic approach and diverse portfolio of brands, which range from barrel-aged beers to kettle sours to IPAs to hard seltzers.
“Not being able to have a complement to our portfolio with a local craft brewery was kind of a gap,” he explained.
Asked if the acquisition of Platform foretells future craft brewery transactions, Michaelis declined to answer.
As for Platform, the company will end its self-distribution business in Ohio — where about 90 percent of its volume is sold — and join A-B’s wholesaler network in the state, Benner said. Although the company is ending its self-distribution business, it won’t be laying off workers.
Meanwhile, A-B will help Platform complete a pair of expansion projects currently underway: a dedicated sour beer facility called the “Phunkenship,” which is slated to open in about three months, and a 10-barrel brewery and tasting room in Pittsburgh, which is expected to open in the first quarter of 2020.
“All of these projects and future projects are made a lot easier by having a partner that is able to provide resources where it makes sense,” Benner said.
Addressing comments on social media that Platform was a brewery “built to sell,” Benner said “absolutely not.” He pointed to the company’s roots as a neighborhood brewery that produced 91 barrels of beer in its first year.
“The aspirations were not very high,” he said. “Over the years, we’ve taken it very seriously. It’s not a hobby for us. We always wanted to grow a great brand, a great business. That means you need to have a great product, great branding, great message, great employees. As you do that, you realize we’re doing the right things and making good decisions, we’re becoming a very attractive partner for somebody like Anheuser-Busch, without necessarily knowing it.”
As such, joining A-B’s Brewers Collective of acquired breweries — such as Wicked Weed, Goose Island, 10 Barrel, Elysian, and Golden Road, among others — will allow Platform to “leave a legacy as a company,” Benner said.
“We feel like this partnership is going to allow us to be a brewery that’s around for decades,” he added. “It’s going to be a transformative and iconic brand here in the state of Ohio.”
According to Benner, the transaction does not foretell a national expansion. He explained that the company will continue to expand “responsibly” within its current regional geographic footprint.
Michaelis added: “The footprint that they have right now is enough for us to have a good amount of time growing.”
Nevertheless, joining A-B means Platform will no longer be considered a small and independent craft brewer as defined by the Brewers Association. Benner said he’s OK with losing the designation.
“We still have incredibly passionate people making really interesting creative beers,” he said. “To me, that’s craft beer. We obviously won’t fall into that definition by the BA, and that’s OK. But we hope that our customers who have loved our product up to this point recognize — and we’ll prove to them — that it’s the same high quality and it’s only going to get better.”