New Orleans-based Faubourg Brewing Company has merged with Made By The Water (MBTW), a southeast-based portfolio company, with the plan “to be one of the largest craft beer producers in the United States.”
Made by the Water (MBTW), a portfolio company of family office Wiregrass Equity Partners, is the parent company of three craft beverage-alcohol brands in the southeast: Asheville, North Carolina-based Catawba Brewing; Apalachicola, Florida-based Oyster City; and Charleston, South Carolina-based Palmetto Brewing.
Ownership of the company following the merger will be split 50/50, Alexi Sekmakas, CEO of MBTW and the combined entity, told Brewbound.
“This is truly a merger – everything from the governance of the company through internal operations,” he said. “It is a bringing together of the two teams.”
Through the merger agreement, MBTW will move its headquarters to Faubourg’s brewery in East New Orleans. The 85,000 sq. ft. brewery – valued at $30 million – has the capacity to produce more than 100,000 barrels annually, which the collection of brands is targeting “quickly,” according to a press release.
Faubourg will continue to brew its full lineup of offerings, which will now be supported by MBTW’s distribution network across North Carolina, South Carolina, Alabama, Florida, Georgia and Tennessee. Visitors to the brewery will also be able to enjoy offerings from MBTW’s portfolio of other craft brands.
The merger gives Faubourg and MBTW access to each other’s distribution footprints, which have no overlap, so neither brand will need to change wholesalers. MBTW will expand into Faubourg’s primary markets of Louisiana and Mississippi, while Faubourg will make its way into Florida, Georgia, South Carolina, North Carolina and Tennessee, Sekmakas said.
The company plans to widen the portfolios of Faubourg, Catawba, Palmetto and Oyster City, he added.
“So far the conversations have been incredibly positive – more variety of beers and ability to produce at a much larger scale,” Sekmakas said.
Faubourg recorded steady production increases in the years after current owner Gayle Benson and her late husband Tom Benson acquired it in 2017, including a +32% increase year-over-year in 2020, according to estimates by the Brewers Association (BA). Production remained flat in 2021 at an estimated 12,500 barrels.
MBTW acquired Catawba and Palmetto nearly a year ago in a deal that included both brands, the Twisp Southern Hard Seltzer brand that Catawba launched in 2019, and taprooms and production facilities in Asheville, Charlotte, Wilmington and Morganton, North Carolina; and Charleston, South Carolina. Twisp has been taken out of distribution, but is still produced for the company’s taprooms as an alternative to beer for guests, Sekmakas said.
Last year, MBTW’s family of brands increased their volume output +14%, to 43,881 barrels of beer, according to the May/June issue of the BA’s New Brewer.
Based on 2021 volume data, the companies’ combined output (56,381 barrels) would make the new entity one of the 50 largest craft breweries in the country by volume.
As the Faubourg facility shifts to producing MBTW beers, the company will wind down production of its contract brewing partners, Sekmakas said. The extra capacity is a boon to the MBTW brands, which have faced difficulty meeting demand.
“We’ve been struggling to make sure that we can fill orders on time just on the great volumes we’ve been enjoying this year,” Sekmakas said. “So, it’s exciting to have a whole new engine to drive and brew that beer for us.”
The transition will also create new jobs at the Faubourg facility, including brewing and manufacturing jobs, as well as administrative positions in HR, finance, sales, brand management and marketing, according to the release.
“This merger is about making New Orleans the cultural hub of the craft beer industry in the Southeast,” Faubourg owner Gayle Benson said in the release. “Our partnership with Made By The Water allows us to grow the Faubourg brand, and bring in a partner that is a leader in building craft beer brands. I pride myself on making New Orleans first, and I think we can bring all of the best in craft beer from these historically strong craft beer areas in the Southeast and make New Orleans the primary focus of the industry.”
Faubourg has had a tumultuous 100+ year history since its founding in 1907 (then called Dixie Brewing), including surviving prohibition, two world wars and Hurricane Katrina, which forced the company to relocate and contract brew its offerings. The Bensons – also owners of the NFL’s New Orleans Saints and NBA’s New Orleans Pelicans – restored the brewery and reopened it in New Orleans in January 2020, weeks before the COVID-19 pandemic forced the closure of on-premise establishments.
Amid the country’s racial reckoning following the murder of George Floyd in 2020, then-Dixie announced it would change its name to shed its connection to the Confederacy. The company underwent a rigorous search process and selected Faubourg, the French word for “suburb” which is synonymous with “neighborhood” in New Orleans. In March 2021, the company released its first beer under the new name Faubourg Brewing Co. with updated packaging to match.
Faubourg recorded steady production increases in the years following its ownership change, including a +32% increase year-over-year in 2020, according to estimates by the Brewers Association (BA). Production remained flat in 2021 at an estimated 12,500 barrels.
MBTW acquired Catawba and Palmetto nearly a year ago in a deal that included both brands, the Twisp Southern Hard Seltzer brand that Catawba launched in 2019, and taprooms and production facilities in Asheville, Charlotte, Wilmington and Morganton, North Carolina; and Charleston, South Carolina.
Last year, MBTW’s family of brands increased their volume output +14%, to 43,881 barrels of beer, according to the May/June issue of the BA’s New Brewer.
Editor’s note: this story was updated at 2:55 p.m. ET on September 22 to include commentary from CEO Alexi Sekmakas.