Long Trail quietly seeks acquisitions
Toolbox
By DANIEL BARLOW Vermont Press Bureau - Published: November 26, 2009
MONTPELIER – The Long Trail Brewing Company is in quiet negotiations to purchase the Otter Creek and Wolaver's brands in a deal that will be finalized by the end of the year, according to several sources.
Long Trail, the Bridgewaters Center craft brewery that celebrates its 20th birthday this year, is expected to close on the deal by the end of December that would see it own two of Vermont's other popular beer brands.
The sale was first reported Wednesday by Andy Crouch, a Cambridge, Mass., attorney and beer journalist on his BeerScribes.com Blog. The story was later confirmed by a Washington County pub owner, who asked to remain anonymous.
Crouch, the author of the book The Good Beer Guide to New England, said Wednesday that he has two sources for the story, but had agreements not to name them.
"I can say that the employees of Otter Creek and Wolaver's were informed of Long Trail's intention to purchase the brewery early last week," Crouch wrote in an e-mail. "The two companies are presently in the due diligence process and both are mum about the future plans for the combined enterprise, including the future of particular brands."
Calls to Long Trail and Otter Creek revealed little new information. Tom O'Grady, a spokesperson for Long Trail, said he had "no comment" on the report. Calls to Otter Creek and owner Morgan Wolaver's were not returned Wednesday.
Founded in 1989 by Andrew Pherson, who still serves as the company's president and brew master, and named after the 272-mile hiking trail that runs the length of the state, Long Trail is very popular in New England. Nearly half the beer the company brews is consumed in Vermont.
Named after a 90-mile stream that flows into Lake Champlain, Otter Creek was founded in 1991 and purchased nearly eight years ago by the family that owns Wolaver's Certified Organic Ales. According to industry reports, Long Trail brewed about 30,000 barrels of beer as of 2005 and distributes in 22 states.
The sale, if finalized next month, greatly boosts Long Trail's slate of beer offerings and expands its network distribution beyond the northeastern United States. It was not clear Wednesday if Long Trail intends to keep the Otter Creek and Wolaver's brands (when Wolaver's purchased Otter Creek the company kept both lines intact and separate).
Crouch said it is not clear yet if the Wolaver's brand of beers is included under the sale, but said he would expect that brand – which has a good industry reputation for its organic products – would remain intact. There could be changes to Otter Creek coming, however, he warned.
"It is hard to say what this portends for Otter Creek and Wolaver's in particular and their brands," he wrote. "To the extent that Long Trail is seeking the use Otter Creek's extra capacity to produce its own line of beers, including the Long Trail Ale, then I would expect to see a substantial reduction in the Otter Creek brands, save for the flagship Copper Ale."
Vermont is known for its craft beers – in fact, the state was named the first in the United States for the number of craft breweries per capita. The Magic Hat Brewing Company of South Burlington – the maker of the popular apricot-flavored #9 beer – is perhaps the state's best known local brew.
Harpoon Brewery, although it is headquartered in Boston, has its largest plant in the town of Windsor. Other craft breweries in Vermont include Trout River of Lyndonville, Switchback of Burlington and Rock Art Brewery of Morrisville.
But the rise of craft brews in Vermont, which began in the 1980s and really picked up steam in the 1990s, may soon be coming to a close. Like many industries, some of the more popular craft brewers have found themselves consolidating or selling to the bigger companies outright.
Crouch points to two recent deals as evidence of this trend: The 2007 sale of Old Dominion Brewing in Virginia to Fordham Brewing Company and Anheuser-Busch, and last year's sale of Seattle's Pyramid Breweries to Magic Hat.
"These operations are often run by individuals or a small group of people, many of whom have invested their own retirement savings in building up their businesses," he wrote. "As these pioneers get older, they are going to inevitably reach the point where they need to draw their investments out of their small businesses."
Daniel.Barlow@timesargus.com
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