Yucaipa Taps Into U.S. Craft Beers

dauss · Mar 19, 2013

Ron Burkle's Yucaipa Cos. is the latest investment firm to tap the small but fast-growing craft beer industry, taking a majority stake in a startup company that plans to spend more than $100 million to build five new breweries.

Instead of brewing its own beer, Brew Hub LLC of St. Louis, Mo. hopes to fill each facility with at least half a dozen small brewers who want to expand production but face capacity constraints. The new venture will also offer brewers other fee-based services, including distributing and marketing support.
....
Outside money increasingly is looking for a way in. Last year Fireman Capital Partners bought a majority stake in Utah Brewers Cooperative, maker of Squatters and Wasatch beers, while Sage Capital acquired a 60% stake in Saint Louis Brewery Inc., maker of Schlafly beer.

Equity deals still have been few and far between, though, because many craft brewers are reluctant to surrender control. Many are seeking bank loans to expand their own facilities, renting space from so-called contract brewers or joining with other small brewers to keep up with demand. Up to five million barrels in new brewing capacity are in planning stages across the country.

"We're helping them scale but allowing them to stay in control of their destiny,'' said Frank Quintero, a principal at Las Vegas-based Yucaipa.
.....
Brew Hub plans to break ground by May on a 75,000-barrel brewery in Lakeland, Fla., a state where brewing capacity is particularly tight. Over the next five years, it plans to build at least four other breweries in other parts of the country, including Texas and a mid-Atlantic state. Tim Schoen, a former Anheuser-Busch executive, will run the company.

Jim Gorczyca, owner of O'Fallon Brewery in the St. Louis area, says he's weighing whether to build a new brewery or partner with a company such as Brew Hub after shipments at his brewery soared 21% last year to 10,500 barrels. He'd also like to expand into more states.

http://online.wsj.com/article/SB10001424127887323639604578368760907968712.html

Seems that big money is flowing into the craft beer industry from outside interests. Are these investment firms just looking for a way to make a quick buck or actually help and support the craft beer industry?

emannths · Mar 19, 2013

dauss said: ↑

Seems that big money is flowing into the craft beer industry from outside interests. Are these investment firms just looking for a way to make a quick buck or actually help and support the craft beer industry?

It takes two to tango. If these sorts of ventures are successful, it will be because craft brewers find them helpful. I don't think successful investments and craft beer are mutually exclusive.

phooky · Mar 19, 2013

dauss said: ↑

Seems that big money is flowing into the craft beer industry from outside interests. Are these investment firms just looking for a way to make a quick buck or actually help and support the craft beer industry?

If A, then B.
Now please open one on the east coast and convince Russian River to brew there.

Also, anyone else think it won't be long until we see an actual Yuca IPA? I for one really like yuca fries.

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Yucaipa Taps Into U.S. Craft Beers

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