Molson Coors made headlines this week when it announced that it agreed to purchase Kentucky-based distillery Blue Run Spirits, marking the beer giant’s first spirits acquisition and the formal launch of its Coors Spirits Co. business. It may signal more interest in straight spirits from wine and beer companies, as portfolios shift into total beverage platforms.
But this isn’t the beer company’s first foray into bourbon: Molson Coors launched premium whiskey Five Trails in September 2021 and Barmen 1873 Bourbon a year later. As higher end whiskey drives spirits sales, the acquisition mirrors other recent moves by major spirits players. American whiskey is a particularly hot category: sales were by 10.5%, totaling $5.1 billion in 2022, and up 3.2% off-premise in the past 52 weeks ending July 15, compared to this time last year.
For some perspective on the deal we chatted with Jeff Hopmayer, founder of the Brindiamo Group, a global leading provider of bourbon, whiskey, and other spirits that also offers consulting services, plus mergers and acquisitions direction in the adult beverage industry.
“I think that Coors and other spirits companies are looking to augment their offerings to stay current. So they’re always looking for brands and opportunities to help them move their platforms,” Hopmayer explained.
Fair enough, but why Blue Run?
“I know the team at Blue Run and they’ve just been exceptional: the brand is doing really well, the packaging is spectacular, it’s very cool, and it’s very vibrant,” he said. “I believe Blue Run is also bottled at Bardstown Bourbon Company, where I believe the Coors Five Trails product is also bottled, so it probably helps with some of the consolidation costs and things like that as well.”
As many beer companies transition into total beverage companies, spirit acquisitions from groups that were previously beer portfolios is a trend that Hopmayer believes will continue.
“Certainly when we’re looking at different clients and different buyers and sellers, we always think that any of the beer companies could be buyers for any of the things. So, I think that traditional distribution from 10 or 20 years ago has changed.
Some rules have changed, the way they approach things have changed. And I think that’s causing lots of these companies to look at what typically in the past would have been taboo or not part of their core, to now go into new categories to expand. Because they’re all going to the same customers at the end, and delivering to the same places. So if they can create more pounds per stop it creates a great opportunity for them.”