The acquisition by Craft Brewers Alliance is not expected to affect isle operations
POSTED: 01:30 a.m. HST, Aug 04, 2010
The owner of two major national craft-beer brands is acquiring Kona Brewing Co., Hawaii's largest brewery, in a nearly $14 million deal.
The Big Island-based company is being bought by Craft Brewers Alliance Inc., a publicly traded firm that owns Redhook and Widmer Brothers breweries in Oregon, Washington state and New Hampshire.
As part of the deal, which is subject to customary closing conditions, owners of Kona Brewing will receive $6 million in cash and about 1.7 million shares of Craft Brewers stock valued at $7.9 million.
If the acquisition is completed as expected, Kona Brewing will become a wholly owned subsidiary of Craft Brewers, and owners of Kona Brewing will become shareholders of Craft Brewers.
Mattson Davis, Kona Brewing's president and chief executive officer, will continue to lead the local brewery in the same positions.
Davis said the acquisition isn't expected to result in any operational changes for Kona Brewing in Hawaii or affect its 175 employees.
"Our commitment to the community is as strong as ever," he said.
The sale will provide Kona Brewing with greater access to capital, which will allow it to continue to expand its distribution on the mainland.
SOMETHING'S BREWING» WHAT: Kona Brewing Co.
» WHERE: Kailua- Kona
» FOUNDED: 1994
» EMPLOYEES: 175
» SIZE: 23rd largest in U.S. (13th largest among craft brewers)
» PRODUCTION: 3.5 million gallons of beer in 2009
» MOST POPULAR BEER: Longboard Lager
» MARKETING SLOGAN: "Liquid Aloha"
Kona Brewing was established in 1994 by Cameron Healy and son Spoon Khalsa.
The company operates a brewery and restaurant in Kailua-Kona on the Big Island as well as restaurants in Hawaii Kai and Honolulu Airport on Oahu.
With beer distributed in 28 states and Japan, Kona Brewing was the 13th-largest craft brewery in the United States based on 2009 sales, according to the Brewers Association.
Craft Brewers was created in 2008 from a merger of Redhook Ale Brewery Inc. and Widmer Brothers Brewing Co., both founded in the early 1980s.
Kona Brewing Co. retained Widmer in 2001 to brew all its bottled beer, and in 2003 contracted with another company jointly owned by Widmer and Redhook to distribute its beer.
In 2008, Kona Brewing arranged to have its beer brewed and distributed on the East Coast through the Redhook brewery in New Hampshire.
As part of the brewing and distribution partnership with Redhook and Widmer, Craft Brewers held a 20 percent ownership interest in Kona Brewing.
Shares of Craft Brewers stock closed yesterday up 30 cents at $4.96 on the Nasdaq stock exchange.