Reuters: Lagunitas Exploring “Strategic Options”

Tony Magee presents at the Brewbound Session in 2012

Tony Magee presents at the Brewbound Session in 2012

It seems there’s always another rumor of a top-50 craft brewery sale.

Today, Lagunitas made a Reuters headline that suggested the country’s fastest-growing craft brewery is currently exploring “strategic options, including the sale of an equity stake.”

Citing “people familiar with the matter,” the news outlet said the company is working with Wells Fargo & Co. and could be valued “around $450 million.” Those same sources also said a joint venture was being explored, adding that “there is no certainty that any deal will materialize.”

Reached briefly by phone, brewery founder Tony Magee wouldn’t comment on the story or speculation that his company was for sale.

Certainly, a deal with a private equity firm for the purpose of raising growth capital would represent a major turnaround from Magee’s statements last year. During a Brew Talks meetup at Lagunitas’ Chicago brewing facility, held last September, Magee shared his views on M&A activity in craft, speaking specifically to private equity’s involvement in the space.

At the time, he described private equity as “destructive.”

“When you start making deals that involve moving of equity — if you are doing it because it is your time to step aside, well, you know, that may be the thing to do,” he said. “But to do it in a way to grow and accelerate your growth, I think represents a bit of impatience.”

“They (private equity firms) all have investment horizons — three to five years, some of them seven at the longest. (The firms) have to close the fund and resell. Things will change,” he added.

And what happens when you have hundreds of breweries that have all taken on private equity money?

“All of them trying to create the value that they need to create so they can spin it to the greater fool,” he said. “That will change the texture of the industry.”

During the conversation, Magee also claimed to have fielded dozens of emails from interested buyers, joking that his company’s “number” was “$12.2 trillion”

“We’ve talked all the way to terms letters with three different private equity funds,” he said at the time. “I know exactly what these guys think. We know exactly what they want. We bent them over as far as they would bend over, and they were going to take the deal. And then we told them to take a hike, stand up and pull your pants back up and get it over with.”

Sales of Lagunitas grew 50 percent in 2014, to more than 600,000 barrels. The company is ranked as the 6th largest U.S. craft brewery by the Brewers Association.

According to market research firm IRI Worldwide, Lagunitas’ off-premise sales in supermarket and convenience stores are up 55 percent, to more than $69 million, through July 12. Lagunitas IPA is the company’s top brand and represents 54 percent of its business.

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