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The mass-market brewer that sports an impressive portfolio of over 90 brands, including its namesake Coors and popular beers such as Miller Lite and Blue Moon, has bought a large stake in “next-generation beverage incubator” L.A. Libations.
A multiyear partnership agreement was reached, though the amount was left undisclosed, according to a Monday press release.
"Developing a strong portfolio outside the traditional beer category is an important part of our long-term strategy, and this partnership with L.A. Libations enables us to pursue opportunities in this space without needing an extensive non-alcohol infrastructure," said Pete Marino, president of emerging growth for Molson Coors, in the release.
"Their expertise in creating and nurturing brands is especially valuable at a time when much of the growth in the beverage industry is coming from brands and categories that often were nonexistent five years ago."
Two L.A. Libations board seats will be open to Molson Coors. The equity investment will also provide the brewing giant a stake in new product launches as well as category-exclusive access to brand development services, including creation, building, consulting and insights.
Per the agreement, Molson Coors will have the option to purchase beverage brands created under L.A. Libations in full. The brewing company will maintain a financial stake in brands it does not purchase from L.A. Libations.
The partnership between the two beverage companies didn’t happen overnight. L.A. Libations helped Molson Coors expand its acquired Clearly Kombucha brand in June 2018, according to the release.
Recent reports have shown that younger generations and health-conscious consumers are choosing to ditch beer for other alcoholic or non-alcoholic alternatives. L.A. Libations has made a name for itself tapping into this shifting base by working with like-minded emerging beverage brands. Additionally, L.A Libations helps the brands it partners with to make it onto retail shelves.
In terms of its partnership with Molson Coors, L.A. Libations views it as a great opportunity to expand its business.
"We are honored that Molson Coors has chosen L.A. Libations as their emerging brand partner, and we intend to jointly become a major player in the non-alcohol space," said Danny Stepper, co-founder and CEO of L.A. Libations.
He added: "This strategic partnership with Molson Coors is an important step for our company, brands and partners, as it unlocks access to brand-building capital, capabilities and efficiencies towards utilization of a world-class distribution network."