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News Alert: Boston Beer Jolts Craft World With Deal For Dogfish Head

May 9, 2019

Massachusetts brewer the Boston Beer Company has acquired Delaware’s Dogfish Head Brewery in an agreement valued at $300 million. The deal will fold Dogfish Head’s portfolio and brewery into Boston Beer’s larger corporate structure, including putting Boston’s sales team in charge of Dogfish Head. Sam and Mariah Calagione, Dogfish Head’s co-founders, have agreed to take the majority of their payment in the form of Boston Beer Company stock. Following the completion of the deal, Sam Calagione will join Boston Beer’s board of directors.

The deal, which is expected to close near the end of the second quarter, will transfer over 400,000 shares of Boston Beer stock to the Calagiones at $314.60 apiece. Dogfish Head shareholders will receive $173 million from the sale, minus costs associated with the deal. In a release Calagione said that he and his wife intend to reinvest “nearly all of the proceeds back into the combined entity” with a portion held in reserve for charitable donations.

Boston Beer reports that Dogfish Head will sell almost 300,000 barrels of beer for 2019, with sales between $110 million and $120 million. Including beer, malt-based RTDs and cider, Boston Beer’s volume in calendar 2018 was 4.29 million barrels, up 17% from the previous year. By comparison, D.G. Yuengling’s 2018 volume was 2.64 million barrels, down 2.3% from the previous year.

Boston Beer CEO Dave Burwick will remain in his role following the acquisition. The combined company will remain an independent craft brewery as defined by the Brewers Association. As of last year, Boston Beer is the second largest craft brewery in the U.S. and Dogfish Head is the 13th, according to the Brewers Association.—Shane English

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