Distributor and beverage-maker Constellation Brands on Nov. 16 announced an agreement to acquire San Diego-based Ballast Point Brewing & Spirits. Constellation will pay $1 billion for a craft beer company with sales of $115 million.
The Victor, N.Y.-based acquirer called Ballast Point "one of the fastest growing craft beer companies in the U.S., with a beer portfolio that includes more than 40 different styles of beer, led by its popular Sculpin IPA and Grapefruit Sculpin IPA. The partnership with Ballast Point provides a high-growth premium platform that will enable Constellation to compete in the fast-growing craft beer segment, further strengthening its position in the highest end of the U.S. beer market."
Ballast Point is on pace to sell nearly 4 million cases in calendar 2015, which would represent growth of more than 100 percent over calendar 2014. Volume and net sales growth from 2012 to 2014 averaged more than 80 percent.
Ballast Point started in 1996 as a small group of home brewers. It will operate as a stand-alone company with its existing management team and employees running the day-to-day operations. The brewer employs more than 500, produces beer in four facilities in the San Diego area and sells its beer in more than 30 states.
Constellation Brands originally was an international distributor of wine and spirits. With its 2013 acquisition of Grupo Modelo's U.S. beer business, it became a huge force in beer, gaining the rights to sell the Corona, Modelo, Pacifico, Victoria and Tsingtao brands in the U.S., as well as ownership of a state-of-the-art brewery in Nava (Piedras Negras), Mexico. Constellation bought those assets for $4.75 billion from Anheuser-Busch InBev to satisfy anticompetition issues as Anheuser-Busch and InBev merged. Constellation had 2014 sales of more than $6 billion.