Craft brewer Cigar City sells … but not to AB-InBev

Why did they change their mind? After months of rumours, it was finally announced that Florida’s craft brewer Cigar City would be sold. But it was not to AB-InBev as many had assumed. While there were talks between AB-InBev and Cigar City, and even a letter of intent signed in late 2015, the exclusivity period expired without AB-InBev having made a formal bid. We wonder why? In any case, this allowed Cigar City to negotiate with other interested parties.

In the end, it was Fireman Capital Partners, a Boston based private equity firm, which on 14 March 2016 purchased a majority stake in the popular Tampa Bay-based brewery.

This acquisition adds Cigar City to Fireman’s holding company, United Craft Brews, which was set up for the acquisition of craft breweries. United Craft Brews already holds a stake in Oskar Blues (Colorado), Perrin Brewing (Michigan) and the Utah Brewers Cooperative outfit. Including Cigar City, United Craft Brews represented more than 320,000 barrels beer in 2015 and ranked among the top-15 craft beer producers.

Cigar City reportedly brewed 55,000 barrels beer in 2015, which puts the estimated price tag at around USD 60 million.

2015 was a record year for mergers and acquisitions in the craft space, with more than two dozen deals announced, media report.