Christopher Adams

Christopher Adams is the Markets and Banking reporter for the New Zealand Herald

Independent Liquor on the craft beer prowl

Independent Liquor chief executive Julian Davidson. The company is still on the prowl for new craft beer acquisitions. Photo / NZ Herald
Independent Liquor chief executive Julian Davidson. The company is still on the prowl for new craft beer acquisitions. Photo / NZ Herald

Auckland's Independent Liquor remains on the prowl for acquisition opportunities in the craft beer space.

The Papakura-based company's brewing division, the Boundary Road Brewery, purchased a small Nelson brewer in December and Independent's chief executive, Julian Davidson, says the firm is likely to buy another boutique beer brand within the next 12 months.

"There's a lot of activity in that [craft] sector and we're just basically seeing what options are out there," Davidson said. "Everyone is looking at the craft market quite closely right now."

Independent announced just after Christmas that it had purchased Nelson's Founders Brewery off the Duncan family, who will continue operating the business under the new ownership structure.

The purchase price has not been disclosed.

Founders Brewery's roots stretch back to 1854 and Davidson said the acquisition gave the relatively young Independent, which was established in the late 1980s, access to brand with a lot of heritage.

"We don't have any of the heritage and the brands that the other guys [Lion and DB Breweries] have," he said. "So getting into a brand that's around 150 years old is actually quite neat for us."

In addition to its Boundary Road beer range, Independent also brews international beer brands such as Carlsberg and Kingfisher under license.

Founders Brewery's products had only been distributed on a small scale under its previous ownership and Davidson said Independent planned to eventually distribute the brand nationally.

"The family ... has never really managed to get the brand much further than Nelson," he said. "We're going to sit back, take our time and decide what the right thing to do with this is."

At the time of the purchase Founders Brewery's John Duncan said the acquisition was good news for craft beer drinkers.

"For a long time it's been the family's wish to have others around the country enjoying our beer - now they can," he said.

"We are a brewing family so we are pleased to be working with an organisation that wants to keep these two elements together while supporting and helping us grow the brand."

New Zealand's big brewers - like their counterparts around the world - are watching the rise of craft beer closely and know all too well that consumers' tastes are changing as they opt to drink smaller amounts of higher quality, more flavoursome beer.

In November Lion acquired Dunedin craft brewery Emerson's, prompting outrage from craft beer aficionados on social media websites.

DB's managing director, Brian Blake, has said possible boutique beer brand acquisitions are part of an overall review the company is conducting to establish how it can play "a significant role in the craft market".

"Our focus has very much been on the redevelopment of [existing brand] Monteith's, quite frankly, but that craft market is growing so I think everyone is looking at where the opportunities are," Blake said last year. "We're doing a lot of work on craft beer at present."

The number of small New Zealand breweries - under 40,000 litres annual production - doubled from 15 to 30 in the four years to the end of 2011, while the total number of breweries went from 48 to 68, according to a survey by the Brewers Guild, an industry group representing craft firms.

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