Madison, Wisconsin’s Ale Asylum plans to auction off its equipment and assets, as the company prepares to close its brewery and restaurant in October, according to New Mill Capital, the asset disposition firm handling the sale.
The auction — scheduled to begin October 6 at 11 a.m. ET — will include Ale Asylum’s 30-barrel, 5-vessel brewhouse, more than 20 fermenters and brite tanks, and complete bottling and canning lines, as well as the entirety of the company’s taproom and kitchen, according to the auction listing.
Ale Asylum is also exploring the sale of its intellectual property as the company winds down operations. A “package deal,” in which a turnkey acquisition or partnership is made, is the desired outcome, according to co-founder and vice president Otto Dilba.
“Our No. 1 goal is to make certain the Ale Asylum beers continue in perpetuity moving forward for years to come,” Dilba told Brewbound in an email. “New Mill Capital is fielding inquiries and beginning negotiations for a turnkey operation or whole sale of brands and assets to be produced at a different facility. Our preference is to remain committed to producing and distributing from our existing location through acquisition or partnership.”
Dilba said the decision to sell was made earlier this month, citing “myriad factors.” Rising operational costs were credited in-part for the decision, according to a press release.
“Given the quality of the brewery and how meticulously it has been maintained, we expect a large amount of interest in the assets and will entertain offers in bulk for the operation as well,” Eric Weiler, principal of New Mill Capital, said in the release.
Dilba and Dean Coffey founded Ale Asylum in 2006. Six years later, they moved the brewery to a 45,000 sq. ft., leased brewery, restaurant and brewpub space near Dane County Airport
Ale Asylum’s production peaked at an estimated 22,734 barrels in 2015, according to volume data tracked by the Brewers Association in the New Brewer magazine. However, the company’s volume numbers steadily declined through 2019, when it lost regional brewery status (production in excess of 15,000 barrels) after producing 12,940 barrels of beer, making it a microbrewery (production between 6,000 to 15,000 barrels). In 2020, the brewery broke its declining trends, increasing production 15%, to approximately 14,500 barrels, according to Dilba.
Dilba declined to share production estimates for 2021. However, he said production has increased due to growing demand from wholesalers and retailers, and Ale Asylum’s “brands continue to be strong in market.” The company has maintained its expanded production despite cutting the number of employees from 35 to about 25 during the course of the pandemic, the Wisconsin State Journal reported.
“Our efforts with a lean staff have been geared more towards stewarding the brands through difficult pandemic times and working with New Mill Capital to position our company for the best possible outcome moving forward,” Dilba said.
Regardless of how the brewery is sold, Dilba said he hopes that production of Ale Asylum’s brands, including its signature American pale ale Hopalicious and FVCK Covid hazy pale ale, would continue on under new ownership. He added that he hopes the whomever buys the brewery will also take on its existing staff.
“Ideally we would like to keep the excellent team in place at minimum for a transition period,” he said. “All staff members have been yearslong, ideal employees, with many of them with us since near the beginning of the company.
“All production and leadership staff have expressed interest in remaining on staff for any transition and beyond, making such transition as smooth as possible for the interested party,” he continued.
The auction is slated to conclude on October 13.