Amsterdam Brewery, one of Toronto’s oldest craft breweries, is being sold to Denmark’s Royal Unibrew in a deal valued at $44 million.
It’s the second major Ontario craft brewery to be sold in the wake of the global COVID-19 pandemic, and owner Jeff Carefoote acknowledged that the last two years haven’t been easy.
“Draft beer was about 40 per cent of our volume, and we lost that overnight. We made up most of the revenue by shifting to packaging. It wasn’t easy to do, but we managed to do it,” said Carefoote, who bought the brewery in 2003. Amsterdam was founded in 1986, and was one of Ontario’s craft beer pioneers, along with Brick Brewing.
Neither Carefoote nor Royal Unibrew would comment on exactly how much of the transaction is in cash, versus a takeover of Amsterdam debt. The deal is for 100 per cent of the company.
Amsterdam has annual revenues of approximately $34 million, and has $5 million in earnings before interest, taxes, depreciation and amortization (EBITDA).
The havoc wreaked by COVID on the global supply chain also played a role for Royal Unibrew itself, the company acknowledged in a press release. In a press release, Royal Unibrew said it plans to produce some of its own brands at Amsterdam, both for Canada and for export to the key U.S. market.
“We will service the market much better and thereby protect ourselves against out of stock and transport congestions which have increased significantly the last 18 months. Further, we will free up capacity on our current facilities in Denmark,” said Royal Unibrew CEO Lars Jensen.
Royal’s plans to use Amsterdam as a North American foothold is good news for Amsterdam’s current employees, argued Carefoote.
“They like the way the company’s structured, and the way it’s run. They’re in this to grow it,” said Carefoote, who will remain with Amsterdam once the deal is complete.
In addition to its biggest brands such as Faxe and Royal, the Danish company also controls several smaller formerly-independent craft breweries, including Kissmeyer Brewing.
In late February, Beau’s All-Natural Brewing agreed to be sold to Toronto’s Steam Whistle Brewing, in a takeover of two of Ontario’s biggest craft breweries.
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