Brewing giant Lion is expanding its craft beer portfolio with the acquisition of America's fourth-largest craft beer brewer New Belgium Brewing.
Lion's global craft beverage division Lion Little World Beverages has signed an agreement to acquire 100 per cent of New Belgium for an undisclosed cash sum. The sale is expected to be complete by the end of next month.
The takeover of New Belgium will establish an expanded presence for Lion in the United States' craft beer market, which represents two thirds of the global craft beer market.
Lion and parent company Kirin Holdings has until now had a limited presence in the US craft beer market.
New Belgium is sold in all 50 states in the United States, and was established in 1991. Today, it is one of the country's largest brewers and produces popular beer brands Fat Tire Amber and Voodoo Ranger. It has brewing facilities in Colorado and North Carolina.
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Rory Glass, Lion New Zealand managing director and chief growth officer, said the acquisition was a significant move for the company beyond its main markets of New Zealand, Australia and Japan. The brewer is also growing its presence in the UK. In April, it launched its Little Creatures brewery and hospitality concept in Kings Cross, London.
"It's incredibly exciting to bring New Belgium Brewing into the family and to see Lion, whose roots are founded in New Zealand, make such a significant play in the largest craft beer market in the world," Glass said.
"It's set to be a great partnership with both companies sharing similar values and a commitment to making great beer and looking after our people.
"Kirin has entrusted Lion with leading its global craft beer strategy. This is a big step for us."
Lion global chief executive Stuart Irvine said the acquisition was a significant step forward for the company's operations in the US market.
New Belgium Brewing co-founder Kim Jordan said the American craft beer pioneer was "excited" about its partnership with Lion.
"We've been pushing the boundaries of beer innovation as pioneers for almost three decades. Lion Little World Beverages are brewers' brewers and we have really felt their commitment to this ancient craft," Jordan said.
"We're absolutely excited about helping to build a collective of breweries – each with their own vibe – who share the same commitment to delighting beer drinkers with great beer, great businesses, and great collaboration among us."
Lion has in recent years acquired a number of beverage brands both alcoholic and non-alcoholic. In March, the brewer announced it had acquired iced tea company Teza and a month earlier signed a merchandising agreement with sparkling water start-up Vista, part of Lion's strategy to move away from a sole focus on alcohol.
As well as expanding its craft beer portfolio, the company is growing its non-alcoholic drinks portfolio, which includes GoodBuzz Kombucha, Mac's Soda and Hopt.
The company wants non-alcoholic drinks sales to make up at least 10 per cent of its total revenue by 2025.
Lion NZ's net profit after tax of $28 million for the year to December 31 was down from $75.6m in the 15 months to December 2017 following a balance date change and costs related to its multi-million-dollar IT transformation. It posted a $39m net profit after tax a year earlier.