USA, CA: Maui Brewing Co. moving ahead with pending acquisition of San Diego’s Modern Times Beer
After initially being cautious, Maui Brewing Co. said on July 28 that it’s moving ahead with the pending acquisition of San Diego’s Modern Times Beer out of receivership for $15.3 million, with the takeover on track to close in late October, The San Diego Union-Tribune reported.
Kihei-based Maui Brewing released a statement saying efforts to buy Modern Times are gaining momentum. Those steps include providing operational funding to Modern Times in the interim before the deal closes, according to court documents.
“We are now even more excited in the future of Modern Times,” said Garrett Marrero, chief executive and co-founder of Maui Brewing, in a statement. “The delays were painful for all. However, it was important that we waited until we had made concrete decisions to avoid any further emotional whiplash for our collective teams.”
Maui Brewing traveled a roundabout path to buying Modern Times, which was forced into receivership in March by lead lender California Bank & Trust after its West Coast expansion was derailed by the pandemic.
Maui Brewing emerged as the favorite potential buyer in June when it was named the stalking horse bidder in the court-supervised auction. After three hours and some 70 bids, however, an affiliate of Anaheim-based Brewery X won the auction, agreeing to pay $20 million for Modern Times.
Brewery X included some lofty performance requirements in its bid. It pledged to fully fund the deal within seven days and close within two weeks.
Brewery X missed the funding deadline, and when questioned by the receiver, withdrew its bid, forfeiting a $500,000 deposit, according to court documents.
Maui Brewing had been named the backup bidder by the court. On the day Brewery X withdrew, Marrero said in an interview that he was taken by surprise. He struck a somewhat cautious tone regarding whether Maui would proceed.
“The football got passed back to us that we weren’t expecting,” he said at the time. “We love the (Modern Times) brand. We love the company. We are just evaluating all of the options.”
On July 28, Maui said in a statement that its executives now believe that it “offers the best option to position Modern Times for future success.”
Jennifer Briggs, chief executive of Modern Times, said the two breweries have much in common and called the prospect of joining forces exciting.
“This has been an uncommon situation in the way we’ve lived it out publicly, and now we have the opportunity to be methodical in opening the next chapter,” she said.
Maui Brewing is on track to brew 90,000 barrels of beer this year. While the purchase of Modern Times won’t provide immediate capacity for all of Maui’s mainland brewing needs, it does give the company a platform to add future capacity, according to its statement. A barrel is equivalent to 31 gallons.
The combined breweries expect to produce 125,000 barrels in 2022, which would make it the country’s 21st largest craft brewer, according to the Brewers Association, an industry trade group.
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