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Wright Beverage Distributing has expanded again with an acquisition.
The company has purchased brand distribution rights from Owasco Beverage Inc. of Auburn, Cayuga County, for Labatt Brewing Co. Ltd.; Pabst Brewing Co. Inc., FX Matt Brewing Co., doing business as Saranac; and Mike’s Hard Lemonade Co.
“We would like to have like brands in all the counties that we service,” said Claude Wright, CEO of Wright Beverage Distributing, a dba of Wright Wisner Distributing Corp. “We service 13 1/2 counties, and we have most of the same
brands in the same counties.”
The transaction represents a volume of 650,000 cases in five counties—Ontario, Wayne, Seneca, Cayuga and Yates—and has been in the works since last summer. Roughly 90 percent of the volume purchased is Labatt products.
Two buyers were involved with the sale of Owasco Beverage, which was founded in 1959. The other buyer is Eagle Beverage Co. of Oswego, which purchased the distribution of Anheuser-Busch brands, including Budweiser, Bud Light and Michelob Ultra.
The acquisition was divided between the two companies because each distributes separate brands. The companies did not disclose the financial terms of the deal.
“What was attractive was that it was a 100 percent vertical acquisition, meaning we already had a business in that geography, in that same footprint,” said Larry Smith, president of Wright Beverage Distributing. “The timing was good for us to do the deal in March.”
Wright Beverage Distributing, which has its headquarters in Henrietta, employs 361 people at all of its locations, including Le Roy, Seneca Falls and Buffalo. The distributor expects to hire roughly 10 more part-time or full-time employees as a result of the recent acquisition.
The acquisition is the third in nearly two years for the company, which acquired Finger Lakes Bottling Co. Inc. in June 2012 and Rochester Beer and Beverage Corp. in June 2013. The combined acquisitions have increased the company’s beer volume by 45 percent—2.64 million in combined case volume.
“It signals our continued commitment to the Finger Lakes area, and we’ve been out there since the late ’50s,” Smith said. “We just continue to invest against the industry and against Central and Western New York.”
The company has a combined business of 11.5 million case equivalents in alcoholic and non-alcoholic brands. Non-alcoholic brands such as Dr Pepper Snapple Group Inc. or Dr Pepper/Seven Up Inc. make up roughly 3 million cases, while some 8.5 million cases are beer.
“This business is consolidating, and it’s not just me; it’s the demands that are put on you by the suppliers and the retailers,” Wright said. “To give the kind of service that you have and have all the brand managers and everything else, you have to have a bigger base.”
Wright Beverage Distributing owns some 68 percent of the market share in Monroe County and reached roughly $132 million in sales revenue at the close of 2013.
As for future acquisitions, the company will seek opportunities when it is ready to, Wright said.
“I think we’re going to cool it for a while and pay off all of our debt,” he said. “These are very aggressive acquisitions that we’ve consolidated by selling Labatt in our entire footprint, making us the largest wholesaler for North American Breweries.”
Eagle Beverage expects its portion of the deal to close next Friday.
“The bulk of it being the Anheuser-Busch and Monster (brands) were already in our portfolio, so it was just expanding our footprint,” said Daniel Dorsey Jr., vice president of Eagle Beverage. “We’re definitely excited about getting into the Finger Lakes region and going down to Cayuga and Seneca County (to) try to increase market share.”
Eagle Beverage hired seven employees from Owasco Beverage and has hired two other people to support the company’s new growth.
4/18/14 (c) 2014 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or email email@example.com.
Correction: In an article on Wright Beverage Distributing in the April 18 issue, the company’s market share was misstated. The firm has a 68 percent market share in Monroe County.
Purchase brews up growth
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