Filipovic says Pirate Life fills missing niche for CUB

It's been a busy few months for CUB Business President Peter Filipovic. He's acquired two of Australia's premier craft breweries - 4 Pines and Pirate Life - for AB InBev.

It's also a smart move in a beer market where craft is becoming increasingly dominant - the industry is worth an estimated $740 million annually and is growing at between 15% to 20% per annum, out performing mainstream beer sales. 

AB InBev made the annoucement that it had bought Pirate Life this morning for an undisclosed price.

Jan Craps, President of AB InBev’s Asia Pacific South Zone, said: “With its focus on canned packaging that gives consumers fresh, well-crafted beers and consistent quality, Pirate Life has resonated with Australian beer drinkers who want something different.” 

A relative newcomer to the craft beer scene, Pirate Life has quickly established itself as one of Australia's most popular brands - its Mosaic IPA recently took out Champion Indian Pale Ale at the 2017 Craft Beer Awards, while it was also voted most popular craft brewery in Beer Cartel's 2017 Australian Craft Beer Survey. 

Filipovic says that while the award wins caught his eye, it was the amazing team at the brewery - led by co-founders Jared ‘Red’ Proudfoot, Michael Collins and Jack Cameron - that impressed him most. 

"They have a great culture at Pirate Life and Red, Mick and Jack are fantastic people," he said.

Not to mention the fact he'd been impressed by the taste of the product when he sampled it to keep an eye on the competition and "keep ourselves honest".

Cameron says the sale was a "rock star opportunity" for the brewery.

"I was really excited when Pirate Life made its first beer three years ago, but I'm even more excited now," he said.

The sale will mean a new $10million brewery for Pirate Life in Port Adelaide.

Proudfoot said he looked forward to getting the new brewery built, with better equipment to further drive consistency and quality, and to having the freedom at the company's original Hindmarsh site to get creative. 

“The reality is we have run out of capacity at Hindmarsh," he explained. "With this partnership we’re in a fortunate position to upgrade to a new, bigger brewery while dedicating Hindmarsh to innovate and craft a whole range of new styles to make sure we keep pushing the boundaries and evolving.” 

Why Pirate Life?

Filopovic said the negotiations to buy Pirate Life were "much quicker" than those for 4 Pines, which were initially broached a year earlier at a football grand final. 4 Pines co-founder Jaron Mitchell confessed to drinks bulletin in September that he thought "Flip" was joking when he sounded him out a year ago about selling.

Pirate Life is seen by AB InBev as filling a missing niche for the company. 

"Pirate Life is very complimentary to our existing portfolio and a welcome addition," Filipovic explained. "It doesn't overlap with Goose Island or 4 Pines. It comes in a mostly canned format, which is very different to our existing portfolio, which is the opposite to our existing brands. The style of beer is also very hop full rather than an easy drinking pale ale."

Cameron remains passionate about cans being the ideal format for maintaining the quality of his beer. Pirate Life will continue to put all of its nine varieties of beer into cans.

"It's the best possible format for hops forward beer," he explained. "Cans keep the beer tasting better for longer."

What's next?

The existing Pirate Life team will be staying on at the brewery following the sale. Cameron said they remain committed to maintaining the quality of the beer they produce.

“Our whole team are sticking around and it’s invaluable for all of us to be able to benefit from the knowledge and skills of some of the best brewers in the world.

"Our guys live and breathe quality. If anything, our beers are going to get better." 

Filipovic said AB InBev's focus would be on building a new brewery for Pirate Life and increasing its distribution throughout Australia.

What about the IBA?

When asked if Pirate Life would be resigning from the Independent Brewers Association, Cameron said it was too early to comment as he hadn't spoken to the association.
The IBA cancelled 4 Pines membership following its sale to AB InBev. 
Chris McNamara, the Executive Director of IBA issued a statement saying: “While every sale of an independent brewery to big beer is disappointing we believe that each of them further underscores the impact the independent brewing industry is having on the traditional beer market in Australia and overseas.

"This was backed up by the recent Beer Cartel survey that showed beer drinkers overwhelmingly preferred to support independent breweries over those owned by multi-nationals.

"Brewery acquisitions such as this grab headlines and generate significant commentary, but it needs to be remembered that there are more than 430 other Australian independent brewing businesses who will continue to put their heart and soul into their beers, and it is for them that the IBA exists. We will be doing all we can to help them take advantage of the opportunities created by ownership changes, such as launching an independence seal in the near future.

"We will continue to work towards our vision of quality independent beer everywhere through Awareness, Quality, Regulatory and Value initiatives for IBA members. We extend our congratulations to the current owners of Pirate Life on the sale."