Constellation Brands placed a big bet on the booming craft beer market Monday, announcing an agreement to purchase San Diego-based Ballast Point Brewing and Spirits for $1 billion.
Founded by a group of home brewers in 1996, Ballast Point was the 31st largest craft brewer in the country in 2014, according to the Brewer’s Association. It makes 40 styles of beer, including Sculpin IPA and Grapefruit Sculpin IPA, allowing Constellation to compete in the fast-growing craft beer segment, Constellation said.
“Along with imports, craft beer is a key driver of growth and premiumization within the beer industry, with craft doubling its share of the U.S. beer market in the last five years,” said Constellation CEO Rob Sands in a news release.
Ballast Point founder Jack White and his management team will continue to run Ballast Point, Sands said. The craft brewer is on pace to sell 4 million cases of beer this year, more than doubling its sales in 2014, Constellation said.
The transaction, which will be financed with a combination of cash and debt, is expected to close by year’s end.
Constellation is based in Victor, N.Y., with its beer division based in Chicago.
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