The Multi-Million Dollar Reason Lagunitas Will No Longer Be Considered Craft Beer

The California brewing giant sells a 50 percent stake to Heineken two years before it’s set to expand to L.A.

Members of the craft beer community were shocked by the news this week that Heineken International would pick up half of California’s Lagunitas Brewing Company. The craft beer community, after all, is generally suspicious of (if not outright hostile to) the idea of mergers and acquisitions. Keep it small, keep it real. In other words, keep it craft.

But according to rules carved into stone tablets by the Brewers Association, your craft card is revoked if a multinational beer conglomerate buys more than a quarter share of your brewery. With Heineken set to purchase 50% of Lagunitas, the California brewing stalwart will lose its craft distinction.

What Lagunitas gets in return is dolla dolla bill y’all. In reporting the deal, Santa Rosa’s The Press Democrat casually drops the figure of ONE BILLION DOLLARS (attributed to anonymous sources) in talking about how much the Petaluma-based brewery is likely worth. If Heineken is dropping anything approaching $500 million on Lagunitas—well let’s just say that can buy a lot of hops.

Lagunitas founder Tony Magee also touts access to Heineken’s worldwide distribution network as a reason for the deal. “[The deal] will open doors that had previously been shut and bring the U.S. craft beer vibe to communities all over the world,” Magee says in a press release.

That lust for worldwide distribution was one of the major reasons that Magee gave for investing in an enormous brewing facility in Azusa (set to open in 2017). L.A.’s proximity to Mexico and the growing Mexican middle class made Azusa the ideal location for Lagunitas’ expansion, he said at the time. He said that it was ridiculous that craft brewers in the U.S. were not exporting to Mexico and that Lagunitas was on the way to becoming the first craft brewery to do so.

Well Lagunitas may make it to Mexico sooner than Magee thought because of this deal. Just not under the banner of American craft.