Beer Man

Ten Colorado Breweries That Would Make Good Buyout Targets

The world of craft beer is changing. Over the past twelve months, more than a dozen craft brewers have been gobbled up, either by larger breweries, corporate breweries, European interests or private-equity investors. And there is more — much more — on the way. If you follow beer, then you've heard the names: Ballast Point, Firestone Walker, Lagunitas, Elysian, Golden Road, 10 Barrel Brewing, St. Archer. Some of these deals have been couched as a way to preserve the independence of the craft brewer; others are simply buyouts. 

In Colorado, the damage has been limited — so far. In January, a Denver-based investment company called Gold Buckle Brewing bought Durango Brewing; Gold Buckle also owns Nevada's Joseph James Brewery. And in March, a Massachusetts private-equity group called Fireman Capital Partners bought an unknown stake in Longmont-based Oskar Blues, which in turn purchased Michigan's Perrin Brewing. Oskar Blues has steadfastly refused to discuss the deal; Fireman also owns the Squatters and Wasatch breweries in Utah.

There's a very good chance that more Colorado breweries will soon be gobbled up as well. Although none of the following breweries has made any indication that it is next or that it would even want to be the target of the buyout — and most of them would probably be annoyed to be included on this list in the first place — all of them would make very ripe targets.

Breckenridge Brewery
Potential buyer: Anheuser Busch-InBev

Breck is owned by Breckenridge-Wynkoop LLC, a holding company that also owns Wynkoop Brewing, Phantom Canyon Brewing, Ale House at Amato's, the Cherry Cricket and several other restaurants. But B-W has sold off a number of restaurants in the past few years and is in the process of selling most of the buildings that house them. The 2011 merger of Breckenridge and the Wynkoop Group never quite felt right — and it feels even more lopsided now that Breckenridge has opened a twelve-acre, $36 million campus that likely required a lot of capital, and some debt. But the Breckenridge brand has never been hotter. Founded in the mountain town of the same name in 1990, its beers have a major regional and national presence, all well-liked for their easy-drinking qualities. As an established brewery, Breck is also the sixth-largest craft brewer in Colorado and the fiftieth nationwide, according to the Brewers Association's 2014 list of the nation's largest craft brewers (a list that will be quite different for 2015). AB-InBev already owns craft breweries in Chicago (Goose Island), New York (Blue Point), Washington (Elysian), Oregon (10 Barrel) and Golden Road (California) — and brews some of those company's beers at its Fort Collins production facility. Why not add a property that is already in Colorado to the mix?

Wynkoop Brewing
Potential buyer: Oskar Blues

Maybe Breckenridge isn't ready to sell. But I'm guessing it could use some cash to help pay off the debt on its new Littleton campus. So why not cash in on a piece of Denver history: the state's oldest brewpub and the legacy of Governor John Hickenlooper, who co-founded the Wynkoop in 1988? Selling this spot to Bud or Coors would be a major PR disaster for Breck, however, because of that historic and political cachet. So selling to another homegrown entity like Oskar Blues might be the best bet. The property would certainly fit OB's profile. Wynkoop already cans its beer, and it's located just two blocks from Coors Field, where Oskar Blues now operates a CHUburger — the brewery's burger enterprise — on the rooftop deck, along with another planned spot in RiNo. And since the Wynkoop is a brewpub, it could serve both CHUburgers and Oskar Blues beers, along with its own offerings. Oskar Blues hasn't made a secret of the fact that it is interested in buying other small breweries across the country, like Michigan's Perrin, so this would certainly seem like a canny move.

Great Divide Brewing
Potential buyer: Duvel Moortgat or Heineken

Like Ballast Point, Firestone Walker, Boulevard Beer, Goose Island and Lagunitas, Great Divide is a regional powerhouse with a strong identity and a portfolio of beers that are known all across the United States — and in Europe. In fact, Great Divide already exports beer overseas. It's hard to image the powers-that-be at Great Divide looking to MillerCoors or Bud for support, but it isn't beyond the realm of possibility that they would consider an offer from Duvel Moortgat Brewery, which owns Boulevard Brewing, Ommegang, and which purchased Firestone Walker last summer, or Heineken, which bought Lagunitas in September. That would allow Great Divide to continue to operate under its own power — at least in the near future — and to fully and quickly utilize the potential of its five-acre, $38 million brewery, packaging facility and restaurant, which should be completed sometime next year.

Crazy Mountain Brewing
Potential buyer: Private equity firm

Since it was founded in 2010, Crazy Mountain has been growing crazy-fast. Owners Kevin and Marissa Selvy are already familiar with the investment world, having come from that industry. They also distribute in nineteen states across the country and export beer to at least four other countries. Oh, and the brewery just happens to be located in the snowy playground for the nation's wealthiest folks, the Vail Valley. Earlier this year, Crazy Mountain moved into Breckenridge space on Kalamath Street, while keeping its Edwards spot open, and began redesigning its beer labels and its look and its packaging lineup. It's only going to grow more quickly after that. 

Fort Collins Brewery
Fort Collins
Potential buyer: Anheuser Busch-InBev

Founded in the early 1990s, Fort Collins Brewery was purchased in 2004 by Tom and Jan Peters, who have expanded a couple of times and grown it into one of the larger breweries in the state. Despite its low profile, Fort Collins makes some award-winning beers and is named after a famous brewing city — one with a lot of recognition nationwide. It is also located just a few miles from Budweiser's huge Colorado production facility and might give a large beer-maker some nice inroads into the state.

Tivoli Brewing
Potential buyer: Coors

Founded in 2012 by longtime Coors employee Corey Marshall and his wife, Debbie, Tivoli Brewing is an interesting creation. The Marshalls started by buying up the lapsed trademarks to the historic Denver beer name Tivoli — along with several other long-forgotten Denver beer brands like Sigi's, Zang's and Neef Brothers — and then brewed some of these German-style lagers at Prost Brewing.The original Tivoli Brewing was founded in 1900 — the heir to other breweries that had started here in the late 1850s — and operated inside what is now the Auraria Student Union until 1969. Last year, in cooperation with Metropolitan State University of Denver's hospitality program and the Auraria campus, Tivoli announced that it would open its own brewery, taproom and restaurant in that historic building. It's a great story for Denver, but Marshall's ties to Coors, and Coors's ties to Colorado history, make this a natural fit. Plus, Coors focuses on lagers, just as Tivoli does, and for better or for worse, also focuses on college-age drinkers.

Declaration Brewing
Potential buyer: Coors

Coors has taken a decidedly different tack than AB when it comes to swallowing a share of the craft-beer market. While AB has simultaneously bashed craft breweries and tried to keep its brands out of bars and liquor stores, it has also been buying up and ramping up its production and distribution. Coors, meanwhile, has focused primarily on its in-house craft-like brands, like Blue Moon. In fact, the only craft beer Coors has purchased was San Diego's St. Archer Brewing, which some people believe was founded in the first place to be a buyout target. The reason: It has a "lifestyle" attached to it. Declaration was founded in a similar way. Sophisticated from the start, the owners went big, both in terms of production and packaging, as well as branding and social media presence: the brewery, which strives to "make a statement," has connections to the winter sports industry as well. And while it may still be too early for Coors to take a chance on Declaration (it just opened in February), the next couple years may change that.

Dry Dock Brewing
Potential buyer: Constellation Brands

Having just notched its ten-year anniversary, Dry Dock is one of the oldest and most decorated of the new wave of taproom-breweries in Colorado. In fact, over the past eight years, it has won 22 medals at the Great American Beer Festival — more than any other Colorado beer maker. Add in the fact that it focuses entirely on Colorado (Dry Dock doesn't distribute outside the state, even though it is one of the fifteen largest breweries in Colorado), yet still has a national following, and this Aurora company makes for a delicious target. Although Dry Dock co-owner Kevin DeLange says he and Michelle Reding have no intention of selling — “It's just the two of us, and we love our jobs and this brewery,” he told Westword in October. “What am I going to do if I sell out at 41? We want to grow conservatively and there is no need to sell out. We wouldn't entertain a buyout or private equity. We have no plans to sell" — I'm guessing it would be hard to turn down the kind of money that Constellation Brands just paid for Ballast Point in San Diego. Not that Dry Dock is anywhere close in size to Ballast Point (Dry Dock makes 20,000 barrels per year versus 300,000 for Ballast Point), but the companies are similarly well-regarded.

Prost Brewing
Potential buyer: Private equity firm

Prost was founded by a group of businessmen in 2012, including an experienced Denver restauranteur and bar owner. Since then, it has grown into a LoHi hotspot that focuses entirely on just a few German-style lagers. Over the years, Prost has grown steadily, adding restaurant accounts. It also began packaging last year and has the capacity to make a lot more beer than it currently does. A popular spot with a great location and beers that appeal to a wide variety of drinkers, Prost seems like a natural money-maker and a good investment for someone looking to stake a claim to Denver — and there are plenty of outsiders who are doing just that right now.

Denver Beer Co
Potential buyer: Anyone

Denver Beer Co has it all: a recognizable name, a savvy marketing reach, a taproom with one of the best atmospheres and locations in Denver, and a production facility capable of brewing and canning a lot of beer. And more recently the brewery, founded by Charlie Berger and Patrick Crawford, has also made inroads in liquor stores, distributing a lineup of strong core and seasonal brews that are clearly recognizable, creative and consistent. The owners are even friends with Mayor Michael Hancock and accompanied him on a recent trade mission to Japan. As a result, the four-year-old company — one of the first in Denver's fourth wave of craft breweries — would make a nice target for any entity from a major corporation to an overseas venture to a private equity firm, or even another brewery or restaurant group. 
KEEP WESTWORD FREE... Since we started Westword, it has been defined as the free, independent voice of Denver, and we'd like to keep it that way. With local media under siege, it's more important than ever for us to rally support behind funding our local journalism. You can help by participating in our "I Support" program, allowing us to keep offering readers access to our incisive coverage of local news, food and culture with no paywalls.
Jonathan Shikes is a Denver native who writes about business and beer for Westword.
Contact: Jonathan Shikes