BrewDog goes big in Japan with Asahi ahead of IPO

Aberdeenshire-based craft brewing giant BrewDog has announced a major joint venture in Japan with Asahi Breweries ahead of a planned initial public offering (IPO) for the Ellon firm in London or New York.

BrewDog has appointed Rothschild as independent adviser to its IPO process.

The joint venture with Asahi will see BrewDog favourites such as Punk IPA, Hazy Jane and Elvis Juice rolled out across Japan.

The joint venture – over which BrewDog will retain a controlling interest – will be known as BrewDog Japan and is the first of its type for the Scottish firm.

The JV will operate as a standalone entity with its own sales, marketing and back-office teams and will focus exclusively on the distribution and marketing of key BrewDog brands in Japan.

San Francisco private equity firm TSG Consumer Partners acquired 22% of BrewDog in 2017 and TSG managing director Blythe Jack was appointed BrewDog’s first chair earlier this year following allegations by former staff that BrewDog operates in a “culture of fear.”

BrewDog has raised more than £94 million via crowdfunding amid its fast growth in recent years.

The Scottish brewer, which was valued at almost £2 billion in its latest crowdfunding round, reported net revenues of £182 million in 2020 and it has opened almost 100 bars and four hotels around the world.

“A partnership with Asahi Japan provides BrewDog with a considerable new platform to accelerate growth throughout a country with a deep legacy of appreciation for craft beer,” said BrewDog.

“The joint venture will focus initially on growing distribution and awareness of the BrewDog brand in Japan and in time will be able to access Asahi Japan’s highly developed distribution network, leveraging its market leading position to rapidly grow BrewDog brands, in particular Punk IPA which currently accounts for 70% of BrewDog volumes in Japan, and Hazy Jane, which in its two years since launch has grown to become the second largest craft beer brand in UK supermarkets behind Punk IPA.

“Other small batch craft beers within the BrewDog stable, plus cider and spirits, will continue to be imported by Whisk-E, BrewDog’s local partner since 2013.

“BrewDog has explored a number of strategic options to accelerate the expansion of its business through the fast-growing Asian markets.

“The creation of a joint venture with the Japanese market leader provides a rapid boost to its distribution capability, while retaining its independence.

“The joint venture will be run by newly appointed Chief Operating Officer, Daisaku Okuda, who brings with him over 30 years experience in the drinks industry, including nearly 20 years at Asahi Japan, most recently as General Manager, Spirits & Liqueurs, with a sales and marketing team based in offices in central Tokyo, working closely with BrewDog’s HQ in Ellon, Scotland.

“The announcement of a joint venture with Asahi Japan comes at a time that BrewDog has considerably expanded its international footprint, growing market share in new markets despite the challenge presented by the COVID-19 pandemic.

“International sales of BrewDog have grown significantly in recent years and its beers are now available in over 60 countries worldwide.

“With brewing operations in Ellon, Aberdeenshire; Columbus, Ohio; Berlin, Germany and Brisbane, Australia; international sales more than doubled between 2017 and 2020 and, despite the context of COVID-19, are expected to show further significant growth over 2021.

“In addition to Japan, BrewDog has a growing presence across Asia.

“Its beers are enjoyed by customers in China, South Korea, Thailand, Hong Kong, Macau, Singapore, India, Taiwan, Malaysia and Indonesia, and BrewDog bars can be found in Tokyo, Shanghai, Seoul and Mumbai, with plans to open in New Delhi in the near future.

“Further announcements on the international expansion of BrewDog are expected soon.”

BrewDog CEO James Watt said: “We’re excited to be growing our presence in Japan and, in Asahi Japan, to be doing so in partnership with one of the most prestigious names in the drinks industry.

“BrewDog’s beers are now enjoyed in over 60 countries around the world and it’s a great testament to the quality of our beers, not to mention the excellent taste of Japanese beer drinkers, that we have this opportunity to grow further in such a significant market.”