Monster Buying Top 10 Craft Beer Brewer: What Investors Should Know

A leading energy drink company is pushing into craft beer with the acquisition of a top 10 national craft beer brewing company. Here’s the details.

What Happened: Monster Beverage Corp MNST announced the acquisition of CANarchy Craft Brewery Collective for $330 million.

CANarchy is the owner of popular craft brewing brands Cigar City, Oskar Blues, Deep Ellum, Perrin Brewing, Squatters and Wasatch. 

In 2020, CANarchy was the sixth-largest craft brewer and the 15th largest overall brewing company, both in the U.S. 

Monster expects the acquisition to close in the first quarter of 2022.

Related Link: Will Coca-Cola Jump In With A Bid For Monster Ahead Of Constellation Brands? 

Why It’s Important:  “This transaction provides us with a springboard from which to enter the alcoholic beverage sector,” Monster’s co-CEO Hilton Schlosberg said.

Monster points to the CANarchy brands adding to its growing portfolio and an opportunity for expansion into alcoholic beverages to grow CANarchy’s scale.

The acquisition comes after rumors of alcoholic beverage company Constellation Brands, Inc STZ making a move to acquire Monster popped up late in 2021.

Monster has also been a rumored acquisition target of Coca-Cola Co KO, the beverage giant that owns a 19% stake in the energy company and helps distribute Monster products.

The energy market is becoming increasingly crowded and Monster could be looking for a move to diversify. In 2020, Red Bull had a 25% market share of energy drinks followed by 15% for Monster.

Price Action: MNST shares are up 0.66% to $94.60 Thursday morning at publication.

Photo: Courtesy of CANarchy