The rumors that circulated Monster Beverage Corporation
the last few years of wanting to enter the liquor market have finally been put to rest and in a big way. The announcement that they have agreed to buy the CANarchy Craft Brewery Collective for $330 million means that one of the biggest players in the highly lucrative energy drink market now owns one of the biggest players in the energy drink market. craft beer.
Established in 2015, CANarchy billed itself as “a disruptive collective of like-minded brewers dedicated to bringing innovative, high-quality flavors to drinkers in the name of independent craft beer,” according to their website. Based in Longmont, Colorado, the company’s products are distributed across the United States and in 21 US counties and territories. The deal brings together some iconic brands under the Monster umbrella – Cigar City, Oskar Blues, Deep Ellum, Perrin Brewing, Squatters and Wasatch. CANarchy’s stand-alone restaurants were not included in the sale.
By purchasing the sixth-largest craft brewer, Monster will instantly gain access to established distribution networks, a respected alcohol think tank and a wide selection of brewers to work with going forward. All items they plan to put to work immediately once the sale closes during the first quarter of 2022.
“This transaction provides us with a stepping stone to enter the beverage alcohol business,” Monster Vice President and Co-CEO Hilton Schlosberg said in a press release announcing the sale. “The acquisition will provide us with a fully established infrastructure, including people, distribution and licensing, as well as beverage alcohol development expertise and manufacturing capabilities in this industry.”
It was reported last year that Monster was discussing a merger with Constellation Brands
This follows several recent announcements that highlighted the continued merging of the once-separate worlds of soda and beer as companies look to boost sales. It seems that the hard seltzer explosion has piqued everyone’s interest. The fact that CANarchy produces lots of hard seltzers made the deal even sweeter.
2021 saw the limited launch of Topo Chico Hard Seltzer, a collaboration between Coco-Cola and Molson Coors
The all-cash deal comes as the craft beer industry in the United States experiences its first decline in modern history due to the lingering effects of pandemic shutdowns. While many smaller brewers are still struggling with half-full halls and serious supply chain issues, larger, more established craft brewers have weathered the storm better. This is because they bring in so much revenue from liquor stores and offsite grocery stores.
According to data from the Brewers Association, CANarchy produced 489,626 barrels of beer in 2020, a 2% increase from 2019, the last time things were “normal” before Covid hit. Their seven manufacturing sites across the United States give Monster the flexibility to roll out new products regionally or expand them nationally.
Once the deal is done, Monster said CANarchy will still operate independently, retaining its own organizational structure and team that CEO Tony Short will still lead. It looks like all the pieces are in place for Monster to start playing in a much bigger and different pond than the one they’ve been swimming in since their debut. Things are about to get even more interesting.
“The CANarchy team is thrilled to join Monster,” the statement said briefly. “We look forward to capitalizing on the combined expertise of Monster and CANarchy to further strengthen our current alcohol product offerings, expand our product portfolio to meet the evolving needs of our customers, and grow our business.”