Why Did Anheuser Busch Buy A Supplier Of DIY Beer Equipment?

Anheuser-Busch InBev SA NV (ADR)BUD
, the $200-billion plus global beer giant, quietly bought a company called Northern Brewer for an undisclosed amount.

According to Bloomberg, Northern Brewer is the largest supplier of do-it-yourself beer kits, allowing customers to make beer from scratch in their home.

The process of making beer at home is quite easy and straightforward. A supplier, much like Northern Brewer, can sell DIY beer makers all the equipment needed to create beer from scratch, including grains, malt, hops, yeast, fermenters and other necessities.

Related Link: What's Going On With Some Of These Major M&A Deals?

Bloomberg noted that novice beer makers can get started with a small kit that can brew one gallon of beer for $15 and up.

Logic Of The Move

So why is the maker of Budweiser interested in this market? As noted by Bloomberg, it is likely that a DIY-beer maker opts for a beer made by one of the thousands of craft brewers than a Bud Light.

The answer could be simple. Bloomberg suggested that by owning Northern Brewer, Anheuser Busch gains a new layer of research and development.

Robert Sherrill, a manager of the Brooklyn craft beer bar, told Bloomberg that by tapping into the DIY-beer market, Anheuser Busch could identify any trends in the beer market and get ahead of the curve.

With an estimated market of 1.2 million homebrewers in the U.S. that produce two million barrels of beer a year, Anheuser Busch could be looking at a trove of valuable data.

Full ratings data available on Benzinga Pro.

Do you have ideas for articles/interviews you'd like to see more of on Benzinga? Please email feedback@benzinga.com with your best article ideas. One person will be randomly selected to win a $20 Amazon gift card!
Posted In: NewsTopicsM&AMoversMediaTrading IdeasGeneralBeerBeer MakingBeer MarketBeer SuppliesBloombergDIY BeerNorthern Brewer
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!

Loading...