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Home | News | Craft Brewers | Molson Coors makes Sharp's deal

Molson Coors makes Sharp's deal

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Make mine Cornish: Doom Bar key to acquisition

Up-and-coming brewer acquired for £20 million

Cask ale, Britain’s tasty, yeast-infused beer style, yet one in decline for decades, was given a fillip this week with Molson Coors (UK) acquiring up-and-coming Cornwall brewer Sharp’s for £20 million.

According to Molson Coors chief executive officer Mark Hunter, the prize in the acquisition is Sharp’s leading beer brand, Doom Bar, a golden-coloured 4.0% abv draught bitter.

“We stated a very clear intent a few years ago to build a portfolio of exceptional brands, one that covers all beer drinking occasions in the marketplace,” Hunter told Brewers’ Guardian.

“One area where we wanted more scale with a brand that we felt had a big future is in cask ale. We were very attracted to the Doom Bar brand and the contemporary feel of it as a cask product.”

Sharp’s is a relative newcomer to the British industry, founded in 1994 in Rock, Cornwall. Annual production today is in the region of 70,000 barrels, with the lion’s share of this comprised of Doom Bar.

Hunter vowed that the provenance of the brand will be respected. Production will continue at Sharp’s brewery, one which offers some capacity headroom for volume growth. He noted Molson Coors’ track record in Canada, where microbreweries such as Creemore Springs in the province of Ontario, which was acquired in 2005, remain operational.

That said, there are plans to grow Doom Bar as a brand, backed by increased marketing spend and national distribution. Hunter also notes that smallpack Doom Bar, currently in clear glass bottles and 4.3% abv, is undeveloped.

He added, “When we understand the brand locally there will be potential opportunity in other markets around the world.”

Cask ale’s fortunes have improved of late, with the beer style’s declined arrested in 2009, as near as returning to growth as possible without actually growing volume. (That said, early indications are that 2010 wasn’t nearly as kind to cask ale.)

With the introduction of beer duty relief in 2002 by then chancellor Gordon Brown, there has been a subsequent explosion of cask ale producers – and beer brands. The number of UK brewers has almost doubled since, approaching 800 in total at the beginning of 2011. Which begs the question – why choose Doom Bar?

Hunter acknowledges the explosion in cask ale choice, explaining that many of these brands have stalled somewhere between 5,000 and 10,000 barrels annually, whereas Doom Bar, “already has scale, it has momentum.”

While many British brewing industry commentators welcomed Molson Coors acquisition – and the reaction of Sharp’s staff has been highly favourable – some corners were less than enthusiastic.

The Campaign for Real Ale, which numbers more than 100,000 members, said in a statement that it has “serious concerns” regarding Molson Coors’ long-term commitment to Sharp’s.

CAMRA chief executive Mike Benner commented, “Once again we are seeing the acquisitive actions of a global brewer buying local brewers to secure what they perceive as marketable real ale brands for short term profit.

“Whilst we welcome the fact that one of the UK’s brewers realises that there is a future for real ale and that they have been remiss in abandoning their own cask ale heritage, we regret that they have decided to take this route and buy Sharp’s brewery.”

Without citing CAMRA by name, Hunter noted that 90% of reaction on the day amongst industry observers, notably beer bloggers, was positive. Further, with the recent £1 million investment in the Worthington White Shield brewery in Burton, as part of Britain’s National Brewery Museum, he questioned why there was a need to doubt the brewer’s commitment to both Sharp’s and cask ale. He commented, “I just feel it’s disappointing, to be honest.”

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