A Japanese beer company just acquired a stake in the biggest craft brewer in New York
Kirin Holdings Co. has acquired a roughly 25% stake in Brooklyn Brewery, the companies announced on Wednesday.
As part of the deal, Kirin's beer-centric division, Kirin Brewing Co., and Brooklyn Brewery will establish a joint-venture in Japan in early 2017, as well as expanding Brooklyn Brewery beer in Brazil.
"This investment is part of a broader strategy to form partnerships and collaborate around the world to build our brand and help grow craft beer wherever we go," Robin Ottaway, the President Brooklyn Brewery, wrote in a blog post on Brooklyn Brewery's website. "But let me be entirely clear - Eric and I will continue to control and operate the Brooklyn Brewery for many years to come. Kirin's investment allows us to do that and a lot more."
The deal is part of a larger trend of beer giants turning to craft beer for growth, especially when it comes to attracting younger drinkers.
Kirin the second-largest brewer in Japan, as the maker of beers such as Kirin Lager and Ichiban Shibori. In 2014, the company began its serious investment in craft with the purchase of a 33% stake in Japanese craft beer Yo-Ho Brewing Co., reports Bloomberg.
Brooklyn Brewery is the 12th largest craft beer maker in the US by beer sales volume, and the biggest craft brewer in New York, according to Brewers' Association data.
With the acquisition, Brooklyn Brewery can continue to label itself as a craft beer, despite Kirin's partial ownership. However, the friction between craft beer and international beer giants is bigger that a simple definition.
Craft beer is a swiftly growing part of the beer industry. In 2015, craft beer was a $22.3 billion business in the US, accounting for 21% market share by dollars - an increase of 16% from 2014. However, as craft beer gets hotter, bigger beverage companies are increasingly interested in investing themselves.
Craft beer acquisitions by major companies, such as Ballast Point to Constellation Brands, Saint Archer to MillerCoors, and Golden Road to Anheuser-Busch InBev, have made many craft brewers concerned about the future of the industry.
"People are genuinely concerned: Are the big brewers starting to even monopolize craft brewing?" Darby Hughes, trends analyst at food and beverage brand-building boutique Quench, told Business Insider last year.
And, for many craft brewers, acquisition means the surrender of a breweries fundamental values.
"We support craft, and craft breweries should be independent, not bastardized by megacorporations who will compromise the quality of the beer to cut corners, cut people, and make a profit," Sarah Warman, craft brewer BrewDog's head of marketing, told Business Insider in March.
Brooklyn Brewery, however, says that the acquisition will only serve to make the craft brand more accessible and international.
In fact, Ottaway argues that Kirin is key to independence, writing in the post: "This investment allows Steve, Garrett Oliver, Eric and me to achieve our #1 goal - to remain an independent owned and operated brewery (as defined by the Brewers Association)."