That second brand, however, only recently became "craft," and only because it married into the family. Shmaltz brewery founder Jeremy Cowan certainly considered his Coney Island Craft Lagers line on the right side of "Craft vs. Crafty" when he launched it in 2007. Proceeds from its flagship lager, Mermaid Pilsner, Sword Swallower, Albino Python and Human Blockhead all went to a nonprofit group to preserve Coney Island's freak shows and attractions. In some cases, the artwork featured some of the performers themselves.
Unfortunately for Cowan and the Coney Island line, the beers were being produced by Uklah, Calif.-based Mendocino Brewing from its facility in Saratoga Springs, N.Y. Though Mendocino was founded in 1983 using the equipment from small-brewing pioneer Jack McAuliffe's New Albion brewery, the Brewers Association points out that not only is 70% of Mendocino owned by India-based megabrewer UB Group; UB uses much of its Saratoga Springs operation to produce its corn-and-rice filled Kingfisher adjunct lagers here in the U.S.
Though Cowan opened a brewery specifically for Shmaltz beers in Clifton Park, N.Y., this year, Coney Island lager wasn't destined to be a big part of that brewery's plans. Back in August, Boston Beer's (SAM) Burlington, Vt.-based subsidiary Alchemy & Science announced that it had acquired all rights to the Coney Island craft beer brands. Alan Newman, the president of Alchemy & Science and co-founder of Magic Hat Brewing, told Brewbound.com that conversations about acquiring Coney Island began with Cowan as early as last year.
"It started over a T-shirt," he said. "I called Jeremy because [A&S co-founder] Stacey [Steinmetz], wanted to get her dad a Father's Day gift. Somehow the conversation got morphed."Coney Island was just the latest acquisition for Alchemy & Science. In early 2012, it bought out Southern California Brewing -- home of the Angel City brand -- and announced its intention to sell and distribute that brand's beer. Both Angel City and Coney Island's founders will stay on for a couple of years to guide the transition while also making those beers at their current facilities. Newman started as a craft brewer, but the brewing operations he's established haven't exactly been afraid of megabrewer-style mergers and acquisitions. Back in 2008, Magic Hat and its parent company Independent Brewers United bought out Seattle-based Pyramid Brewers. Two years later, Magic Hat itself was bought by North American Brewers -- a brewery-buying parent corporation run by KPS Capital Partners. Newman's current work with Boston Beer comes as the Samuel Adams brewer tries to elbow its way to more room on the beer shelves and add to a tap list that already includes its Twisted Tea brands of malt beverages and the Angry Orchard line of ciders. In 2012, Boston Beer moved more than 2.7 million barrels of its various products, which outpaces the 2.58 million barrels Guinness and Red Stripe importer Diageo (DEO) shipped last year.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV