Buying a Second Brewery or Brewpub: Add-On Acquisitions for Established Owners
Owners who have run a brewery successfully sometimes look to grow by acquiring another one that is already operating. An established owner already understands brewing, permits, taproom hospitality and distribution, and may be able to share management, purchasing and marketing across both businesses. Buying a second brewery can also bring an existing customer base, staff and brand in a new neighborhood or market. It still requires the same discipline as a first acquisition, plus attention to how two operations will work together.
This article is general information for owners of existing breweries considering the purchase of another existing, operating brewery, brewpub or taproom brewery. It does not address opening new locations or building a new brewery. Permit and distribution rules vary by state. Nothing here is legal, tax or financial advice.
Why Established Owners Consider an Add-On
- Adding a taproom or brewpub with its own regulars
- Gaining brewing space and an experienced team already in place
- Entering a nearby market with an established brand
- Sharing management, purchasing and back-office functions
Diligence Still Matters
Familiarity with brewing can make an owner overconfident. The target’s earnings, permits, distributor agreements, equipment, lease, wastewater arrangements and brand ownership all need independent review. Our craft brewery due diligence checklist covers each area.
Permits for Another Premises
Permits are generally tied to a specific premises and owner. Acquiring another brewery may require new or amended federal, state and local approvals, and some states limit how many licenses or premises one owner may hold or how privileges apply across them. See our article on brewery permits and licenses and consult counsel early.
Distribution Overlap
If both breweries sell through distributors, their agreements may cover overlapping territories with different partners. State franchise rules and contract terms may limit consolidating brands under one distributor. Counsel should review how the agreements interact before the owner plans any changes.
Brand Strategy
Owners must decide whether to keep the acquired brewery’s name and beers, merge them into their own brand or run both. Each choice affects customer loyalty and staff morale. Changing a well-loved local brand can carry risk.
Management Depth
Running two breweries is different from running one. The owner cannot be at both brewhouses and both taprooms every day. Lenders and buyers alike should consider who will manage each site, whether the acquired brewery’s head brewer will stay and how quality will be kept consistent.
Financing an Add-On Acquisition
Lenders typically evaluate the combined business, including how the existing brewery is performing and whether combined cash flow can support new and existing debt. Depending on the size of the deal and the borrower, options may include SBA loans for craft breweries, subject to program rules on size and affiliation, conventional loans or, for larger combined companies, middle market financing. Every loan is subject to lender approval.
Integration and Cash Needs
Combining purchasing, payroll and point-of-sale systems takes time and money. Owners should plan for integration costs and the working capital needed to support two operations; see our page on craft brewery working capital and lines of credit.
US Professional Funding helps established owners finance the acquisition of additional existing, operating craft breweries and brewpubs. Learn more about our craft brewery acquisition financing.
