Lion has pledged to build a $50million brewery for Stone & Wood, following the announcement it has reached an agreement to acquire 100% of the Fermentum Group. It has also promised to continue the company’s commitment to supporting community ventures.
Fermentum produces brands including Stone & Wood, Two Birds, Fixation, Little Dragon and Sunly Seltzer. It generates about $100 million a year in sales and its stable of craft beer brands make up about 1% of the Australian beer market. The deal with Lion is estimated by the Australian Financial Review to be worth around $500million.
Lion Australia Managing Director James Brindley said: “We have huge respect for what [co-founders] Jamie Cook, Brad Rogers, Ross Jurisich and the team have created; great beer, wonderful brands, spiritual homes in their breweries and tap rooms, an inclusive culture and a commitment to the community.
“We want to grow what they’ve started, giving their people and beers even more reach across the country.
“We have a shared vision of ‘Brewing as a Force for Good’. Lion is Australia’s first large-scale carbon neutral brewer and we will be backing the Stone & Wood, Two Birds and Fixation breweries to go carbon neutral as well. There are lot of areas where we can learn from each other.
“The Fermentum business will continue to be a unique player in the drinks industry and we are excited about the opportunities for growth ahead.”
Prior to its acquisition, Fermentum was working through the funding process for the new $50million brewery at Murwillumbah on the NSW north coast and was exploring all options – cash reserves, debt, capital raise or a potential IPO.
Lion said it will proceed with the project and will also donate $5 million to the inGrained Foundation for long term positive impact and another $1million to Big Scrub Landcare Inc. The inGrained Foundation is a national not-for-profit that supports grassroots environmental and social charities in the areas that Fermentum operates.
“We’ve committed to build the brewery,” Brindley told the AFR, noting that it will be a lengthy process. “It’s a good two years from start to finish.”
Ross told The Crafty Pint the new brewery was an important part of the founders’ ongoing desire to support the Northern Rivers region.
“We wanted to ensure the community can benefit from Stone & Wood,” he said. “[The new brewery] ensures ongoing employment.”
Fermentum Co-Founder and Chairman Jamie Cook added in an interview with The Crafty Pint that the intentions of the four founding families – Northern NSW publican Tom Mooney is the fourth founder – also drove the decision to sell to Lion. Two of the four had decided they wanted to explore other avenues in their lives, which created what Cook described as a “stalemate”. Read more here.
Lion has announced a national ‘Vaxxed to the Pub’ initiative to support Australian hospitality sector that includes free Furphy beers and giving their workers the afternoon off to spend at their local pub.
Cook said the combination of timing and finding the right custodian to take the business forward made joining with Lion the natural next step for Fermentum.
“After an extensive strategic review exploring options to set us up for future growth, we decided to test the waters on whether now was the right time for the founding families to find a custodian to grow Fermentum’s legacy, its people, its culture and its brands, and continue to drive the business forward whilst staying true to its purpose,” he said.
“We only looked for a custodian who would be committed to building the brewery and to support our work in the community. Not only did Lion welcome these ideas with enthusiasm, they demonstrated they have similar values and a focus on Environmental and Social Governance aligned to our “Force for Good” approach.
“Lion’s custodianship of Little Creatures, Four Pillars and New Belgium demonstrates they in fact learn from new businesses, and grow their impact and reach,” said Cook.
Lion said that the next chapter for Fermentum was to unleash its full growth potential, while maintaining the values and purpose so central to the business’ ethos.