Taking the High Road

If you want to raise the blood pressure of any craft beer enthusiast, just mention how Big Beer keeps snapping up beloved craft brands. Well, folks, there’s a new corporate interest group on the scene, gobbling up erstwhile independents at an alarming rate. Meet Big Cannabis.

One San Diego-based beverage, technology and brand management company in particular is currently on a tear. It’s called Cannabiniers and it’s recently signed letters of intent to purchase four craft breweries across the country, including a top-20 brewer in California, a top-40 brewer on the East Coast as well as a Midwest brewery.

The company is no neophyte to the beer industry, though. This is the same operation behind the Two Roots line of non-alcoholic CBD- and THC-infused craft beers. The current lineup features a lager, a stout, an IPA, a blonde and a wheat beer. Each brew first has its alcohol removed and then it’s blended with a low dose—2.5mg—of THC.

The company debuted its products in Nevada in July 2018 with an expectation of selling 2,000 barrels a year. It found the product sold much better than had been expected, selling above the forecast rate at just 10 stores. This made company leadership to sit up and take notice, then formulate a plan to increase its production by acquiring more breweries.

Then Cannabiniers acquired San Diego-based Helm’s Brewing Company, giving it access to 2,000 barrels of production annually. However, with its sights set for 500,000 barrels of production annually, Helm’s was just a drop in the bucket.

Next came a deal with Dad & Dude’s Breweria in Colorado. The small operation (it produced fewer than 1,000 barrels in 2017) has the distinction of being the first U.S. brewery to get approval from the Alcohol & Tobacco Tax & Trade Bureau (TTB) for a CBD-infused beer. Still, for Cannabiniers, the goal of 500,000 barrels was not within an easy reach.

So company brass went looking for more breweries. With letter of intent at the ready, Cannabiniers could announce the purchase of three breweries it has its eye on any time now. In addition, there are plans in place to purchase as many as four more, bringing its possible brewery holdings to nine.

Kevin Love, Cannabiniers’ vice president of market activations, told online trade journal Brewbound that, with the acquisitions, the company is poised to be able to enter at least 20 states. With the cannabis industry expected to top $23 billion in sales by 2022, it’s positioned to hold a sizeable chunk of market share.

“We’ve seen a tremendously positive response to Two Roots Brewing since its initial debut in Nevada,” said president and COO Timothy Walters in a press release. “As more states legalize recreational cannabis, users will continue to seek new, more sociable ways to consume, and companies will increasingly look to adapt to this new wave of consumption. We are thrilled to bring Two Roots to residents throughout California, offering a more enjoyable and socially integrated way to consume cannabis.”

Currently, Two Roots beers are available in only California and Nevada, but with more and more states legalizing recreational marijuana use, the company is dedicated to positioning itself for rapid expansion when opportunity knocks.