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How we helped
Throughout the craft beer boom of the 2010s, a global brewer built a portfolio of brands through a series of acquisitions. Fast forward several years, and the independently operated craft breweries had failed to drive expected growth and were running at a loss.
Faced with increasing performance pressures and the need to redeploy investments towards other parts of its portfolio, the company decided to take an objective look at its craft beer unit. Despite the clear financial challenges, the company still had a level of emotional attachment to the idea of owning craft breweries and was hesitant to accept that the original investment thesis had not come to fruition.
AlixPartners was brought on to complete a fact-based, objective strategic assessment of the craft beer unit, with the license to propose bold measures if necessary.
At the dregs of a trend, a tough sip
Over four weeks, our team conducted a detailed financial analysis to assess plausible pathways to profitability. For each brand in the craft beer portfolio, we evaluated current performance and future potential across several key dimensions, including SKU rationalization, operating model redesign, SG&A right-sizing, brewery operational efficiency, and network reconfiguration. Various scenarios were considered, but no reasonable path to profitability was identified that would justify the cost-to-achieve and the associated risks.
We recommended the exit of the craft beer business. It was not an easy choice, but it was the right one. The client’s executive team fully embraced the recommendation, presented it to the Board, and had the sale approved. AlixPartners remained engaged to support the development of the confidential information memorandum (CIM). A successful sale of the craft beer brands to a strategic buyer was completed a few months later.
5 months
From initial assessment and executive alignment to a successful sale
$23 million
net proceeds from M&A transaction
