New Jersey’s Flying Fish Brewing revealed that it has sold a stake in a transaction that will allow it to maintain independence at a time when many of its craft beer peers are selling to Big Beer rivals.
The terms of the deal weren’t disclosed, but Flying Fish confirmed to Fortune it has sold a stake to members of the Lynette and Haggerty families, which control the Scranton, Pa.-based media company Times-Shamrock Communications. The sale is a way for earlier stakeholders to cash out on their investment, and also for debt-servicing that will put Flying Fish in a better position for future growth. The news was initially reported by a local newspaper that’s owned by Times-Shamrock.
The Flying Fish transaction comes as craft brewers, which are reporting strong sales in the $106 billion beer business, are facing a tough conundrum. Do they sell their business at lofty valuations to Big Beer rivals like Anheuser-Busch InBev (BUD) or private-equity firms hunting for savvy investments? Or do they maintain their independence, but risk an increasingly difficult battle for shelf space and bar taps across America as more and more startup breweries open each day?
Flying Fish is opting for the latter.
“For us it was important to be a local, family-owned business and be around for the long haul,” Flying Fish founder and president Gene Muller told Fortune.
Founded in 1996, Flying Fish hit the craft beer scene during the second big wave of craft brewers, when local peers Dogfish Head Brewery, Victory Brewing, and Yards Brewing also debuted. Volume at Flying Fish exceeded 24,000 barrels last year and the brewery distributes in New Jersey, Pennsylvania, Delaware, and Maryland.
Muller said he liked the transaction with the Lynette-Haggerty families because they intend to make a longer-term investment than a private-equity firm likely would. Muller remains the largest individual holder in Flying Fish, which produces between 15 to 18 different ale styles annually.
When asked about the opportunity to sell the business to Big Beer, Muller says he would of course listen to any offer that might come to the table—but that it would be hard to convince him to sell.
“We distribute within 100 miles, so we aren’t looking for world domination,” Muller said. “I put 25 years into this and I highly doubt I would throw that away for a big sack of money. Never say never, but my motivation wasn’t the money. That’s never been the driving force.”
