UK & China: UK craft beer maker Brewdog partners with Budweiser for China expansion

UK-based craft beer maker Brewdog is expanding in China after partnering with brewing giant Budweiser, BBC reported on February 20.

The joint venture with Budweiser China will see the Scottish firm's Punk IPA and other beers brewed in China.

Brewdog also says it plans to open more bars in the world's second largest economy.

It comes after the company has faced controversies in recent years and has flagged it may pursue a stock market listing.

In a statement, Brewdog founder James Watt described the Budweiser partnership as "transformational" and said it would bring the craft brewery to "every corner of the world's biggest beer market".

Under the deal, Brewdog said it expects its beers would begin to be produced at Budweiser China's Putian craft brewery, in the south-eastern province of Fujian, by the end of next month.

The company said it also plans to open several bars in the country in the next three years.

China, which is the world's biggest market for beer, currently accounts for less than 1% of Brewdog's overall sales.

It is the company's second tie-up in Asia following a deal with Asahi in Japan in 2021, which Brewdog said helped it double its sales in the country.

The company says it currently has an international network of more than 110 bars but just one in China. Brewdog Shanghai, which opened in 2020, is in the Jing'An district of the city.

The Scotland-headquartered firm employs more than 2,300 people and also has breweries in the US state of Ohio, Berlin in Germany and Brisbane in Australia.

The company reportedly planned to start selling shares on the London stock market in 2020 but postponed the move as the pandemic saw pubs and bars closed during lockdowns.

Mr Watt has said Brewdog has no plans to imminently revive a share sale but has hinted that one could take place by the end of this year.

According to Brewdog's 2021 financial results, it saw an annual operating loss of £5.5m ($6.6m).

The company has faced criticism for its marketing campaigns, as well as its workplace culture.

In January this year, Mr Watt said he had paid out almost £500,000 to winners of the company's misleading "solid gold" beer can promotion.

Some winners questioned the worth of the cans and complained after discovering they were gold-plated.

Separately, a letter from ex-workers in June 2021 stated former staff had "suffered mental illness" as a result of working for the brewer.

It made a number of allegations, including that Brewdog fostered a culture where staff were afraid to speak out about concerns.

Mr Watt apologised to former staff and said their complaints would help make him a better chief executive.

20 February, 2023