But now, the principals involved are craft brands: Sam Adams will merge with Dogfish Head in a deal that is valued at more than $300 million.
One of the biggest U.S. craft brewing companies is bringing another beer heavyweight into its fold.
The combined company will continue holding on to their craft brewery status and will boast a leading position in the high end of the USA market.
Although combining forces certainly expands the reach of their brands, the duo emphasized their continued craft-beer cred in an open letter posted on BeerAdvocate: "Those larger worldwide beer conglomerates are still more than 50x our size and our combined company's volume will represent less than 2% of the beer sold in the U.S", it reads in part.
As part of the transaction, Dogfish founder Sam Calagione and his family will get $127 million in Boston Beer stock, becoming the second largest non-institutional shareholders after Jim Koch, the founder of Boston Beer.
Two of America's largest craft breweries are merging.
"There has been an intense amount of consolidation among many craft breweries in the U.S. More than a dozen of our peers have sold to worldwide conglomerates, others have come together through platforms bringing a handful of craft breweries together in roll-ups", Koch and Dogfish founder Sam Calagione said in a blog post.
It also looks like Dogfish Head fans need not worry about the brand suffering any local fallout. Sam and I have stood shoulder to shoulder in some of the defining efforts in craft brewing including the creation of the Brewers Association, the craft beer definition, the craft brewer seal and the creation of the SAVOR food and beer event.
Calagione and his wife and co-founder Mariah will take about 406,000 shares of Boston Beer stock in the deal, making the duo the largest non-instutional shareholders after Koch.
"I don't think the beer will change, it's very good", beer drinker Janet Zorsky said.
But what strikes me more is the the blending of brewing styles.
Two popular independent craft breweries are coming together to "create the most dynamic indie craft-beer company of the 21st century". "This merger better positions Dogfish Head and our coworkers to continue growing within this definition for many years to come".
Boston Beer (NYSE:SAM) had its price target hoisted by equities researchers at Macquarie from $325.00 to $365.00 in a report issued on Friday, BenzingaRatingsTable reports. Boston Beer CEO Dave Burwick will take the reigns of the consolidated company.
Boston Beer is recognized for helping launch the craft beer industry after opening its doors and brewing the first batch of Samuel Adams Boston Lager in 1984. In 2018, depletions- or distributor sales to retailers-climbed about 13% from the prior year thanks to increases for Truly Hard Seltzer, Angry Orchard cider, and Twisted Tea.
Dogfish Head has also been stuck of late. In addition to the now formal collaboration of entities focused on the production of beverages, Dogfish Head also owns an Inn in Lewes along with brewpubs and restaurants in the mid-Atlantic region. The newly combined company will maintain a significant presence in Delaware.
Sam Calagione, founder and brewer of Dogfish Head, said: "Not only are Dogfish Head and Boston Beer two original American breweries, but Jim Koch and I worked hard with other leading craft brewery founders and the Brewers Association to develop and champion what defines independent American brewers".
Boston Beer expects that its current cash on hand and available line of credit will fund the cash component of the transaction. It is expected that Sam Calagione will join Boston Beer's Board of Directors beginning in 2020. The transaction was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this link. The brand expects to post net sales of about $115 million this year, they said in a statement. The deal is expected to be completed later this year.
"More than a dozen of our peers have sold to global conglomerates, others have come together through platforms bringing a handful of craft breweries together in roll-ups", the founders of Dogfish Head, Sam and Mariah Calagione, said in a statement.