Deep Creek in liquidation: Another craft beer company in trouble

A canning line at Deep Creek brewery in Auckland a few years ago, when the company was focused on expanding the brewery with its beers headed for national distribution in Australia.

Another homegrown brewer has found itself in financial trouble after a horror few months for the sector.

Deep Creek described itself as a company with origins as a small brewery in 2011 in Browns Bay on Auckland’s North Shore.

But the company, Deep Creek Brewing operations, is now in liquidation - and a product failure in a huge shipment to China has been blamed.

Paul Brown (left) and Jarred Maclachlan of Deep Creek pictured several years ago.

Liquidators Paul Vlasic and Derek Ah Sam from Rodgers Reidy were appointed liquidators this morning, according to Companies Office records.

Their office told the Herald Vlasic was at the North Shore brewery around 10.30 on Tuesday morning.

On Instagram, Deep Creek expressed sadness.

“Although we battled through the Covid period, this was a difficult time for the company due to market pressures in NZ and also in our key market of China.”

The company said the Chinese craft beer market had rebounded strongly this year but a physical problem with some cans caused a product recall.

“We are deeply saddened by this.”

Deep Creek was founded by Jarred Maclachlan, Paul Brown and Scott Taylor in 2011.

Interests associated with Maclachlan own at least 26 per cent of Deep Creek, while Brown owns 9.5 per cent.

Those two founders gave thanks in an Instagram story to the company’s customers and fans, and to staff.

By 2019, Deep Creek employed 15 staff at a Silverdale brewery and 30 staff at a North Shore brew pub.

It began exporting to China in 2019.

Earlier this month, the brewer told fans on Facebook it was voted “3rd Choicest Craft Beer” in a contest involving 500 beers.

Pursuit of Hoppiness publisher and editor Michael Donaldson on his website said Deep Creek’s current situation was “another hammer blow for the industry”.

Brown told Pursuit of Hoppiness a quality failure on a big shipment to China caused a product recall and subsequent problems saddling the brewer with an insurmountable $400,000 problem.

“The seams were leaking on some of the cans,” Brown told Donaldson.

Even before the North Shore company’s problems, the broader sector had been in some turmoil.

Epic Brewing Company called in insolvency specialists on July 25 after experiencing financial difficulties blamed on Covid-19 and increased costs.

But that craft beer brewer found a new buyer a month later.

And in August, Brothers Beer was put into voluntary administration.

A PwC voluntary administrators’ report said Brothers Beer Ltd and Brothers Wholesale Ltd suffered from Covid-era hospitality restrictions and subsequent inflationary pressures.