Monster Beverage Is Making A Huge Move Into The Alcohol Sector With The Purchase Of CANarchy

The rumors that have swirled around Monster Beverage Corp

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the last few years that they wanted to get into the alcohol-beverage market have finally been put to rest and in a big way. The announcement that they have agreed to purchase the CANarchy Craft Brewery Collective for $330 million means that one of the most prominent players in the highly lucrative energy drink market now owns one of the largest players in the craft beer market.

Formed in 2015, CANarchy billed itself as ‘a disruptive collective of like-minded brewers dedicated to bringing high-quality, innovative flavors to drinkers in the name of independent craft beer’ according to their website. Based in Longmont, Colorado, the company’s products are distributed throughout the United States and in 21 counties and US territories. The deal brings some iconic brands under the Monster umbrella-Cigar City, Oskar Blues, Deep Ellum, Perrin Brewing, Squatters, and Wasatch. Not included in the sale were the CANarchy stand-alone restaurants.

By buying the sixth-largest craft brewer, Monster will instantly gain access to established distribution networks, a respected alcohol brain trust, and a wide selection of brewers to work with moving forward. All items that they plan to put to work immediately once the sale closes during the first quarter of 2022. 

“This transaction provides us with a springboard from which to enter the alcoholic beverage sector,” Monster’s vice chairman and co-CEO Hilton Schlosberg said in a press release announcing the sale. “The acquisition will provide us with a fully in-place infrastructure, including people, distribution and licenses, along with alcoholic beverage development expertise and manufacturing capabilities in this industry.”

It was reported last year that Monster was discussing a merger with Constellation Brands

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, the makers of Corona Extra and Modelo Especial, along with the producers of numerous wine and spirit brands. But it seems that that deal has been shelved, and the team at Monster has struck a significant deal on their own.

This follows several recent announcements that have highlighted the further merging of the once separate worlds of soda and beer as companies look to increase sales. It seems that the hard seltzer explosion has piqued everyone’s interest. The fact that CANarchy produces numerous hard seltzers made the deal even sweeter.

2021 saw the limited launch of Topo Chico Hard Seltzer, a collaboration between Coco-Cola and Molson Coors

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, a product that did quite well and is undergoing a nationwide rollout. This year will see the launch of Mountain Dew hard seltzer, a collaboration between Pepsi and Boston Beer

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, and Fresca hard seltzers, a collaboration between Coca-Cola

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and Constellation Brands.

The all-cash deal comes when the craft beer industry in the US is experiencing its first decline in modern history due to the lingering effects of pandemic shutdowns. While many smaller brewers are still struggling with half-full taprooms and severe supply chain issues, the larger and more established craft brewers have weathered the storm better. That is because they bring in so much revenue from off-premise liquor and grocery stores.

According to data from the Brewers Association, CANarchy produced 489,626 barrels of beer in 2020, an increase of 2% over 2019, the last time things were ‘normal’ before Covid arrived. Their seven manufacturing locations spread across the US give Monster the ability to roll out new products regionally or ramp them up nationwide. 

Once the deal closes, Monster has said that CANarchy will still function independently, retaining its own organizational structure and team that CEO Tony Short will still lead it. It seems that all the pieces are in place for Monster to start playing in a much bigger and different pond than the one they have been swimming in since their start. Things are about to get even more interesting.

“The CANarchy team is thrilled to be joining Monster,” said short in the release. “We look forward to capitalizing on the combined expertise of Monster and CANarchy to further strengthen our current alcoholic product offerings, expand our product portfolio to meet the ever changing needs of our customers and to grow our business.”