Good Drinks Australia (GDA) has acquired Victorian craft brewery Stomping Ground after a “long courtship”, for $7 million cash, 4.5 million GDA Ordinary Shares and a trailing five-year performance component.
Stomping Ground was founded in 2016 by Steve Jeffares, Guy Greenstone, and Justin Joiner. Its Collingwood brewery currently produces roughly 1.5 million litres a year, with capacity to produce more than 2.1 million annually.
Stomping Ground also owns The Local Taphouse in St Kilda and has recently opened a self-branded brewpub in Moorabbin. The business employs more than 100 people.
GDA said, “Based on current volumes of around 1.5 million litres and current venue performance, Stomping Ground is expected to contribute $1.5 million to GDA earnings in its first year with a target to growing annual volume to four million litres by FY27.”
GDA head of strategy Aaron Heary said the acquisition would accelerate the group’s strategy to improve margins and earnings growth by shifting its sales mix to higher-margin products.
“It also improves GDA’s national reach, while adding key venues to GDA’s growing hospitality business.
“Stomping Ground founders were looking to accelerate growth and initially sought to raise capital to fund a major expansion in their sales team, while we were seeking to accelerate awareness and branded sales growth in Victoria through our existing venue strategy.
“During this process it became clear that the joining of the two businesses would achieve both objectives faster and more effectively,” Heary said.
Jeffares said, “There has been a long courtship as we got to know each other, and Guy, Justin and I are excited and confident that the merging of our two businesses will help us both become even stronger.”
“There’s a shared ambition for Stomping Ground to become Victoria’s number one independent beer brand. With GDA’s help, our beers and brand will be more visible and available than ever before,” said Greenstone.
GDA managing director John Hoedemaker said employees would be retained and the founders would be significant shareholders in GDA, joining the executive and management teams.
“We know how to integrate established brands into our portfolio and with our strength of people, sales, marketing, and distribution expertise we expect to grow the Stomping Ground brands to their full potential,” Hoedemaker said.
