Anheuser-Busch InBev (A-B) today announced the acquisition of organic beverage brands Hiball and Alta Palla for an undisclosed fee, giving the world’s largest beer company two more additions to a small but growing portfolio of non-alcoholic beverages.
Founded by Todd Berardi in 2005, the acquisition of Hiball — which markets a line of organic energy, coffee and protein drinks, as well as Alta Palla, a line of organic sparkling juices and waters that debuted in 2016 — marks A-B’s return to the energy drink category after a three year absence. The beer conglomerate had previously managed distribution for Monster Energy through select wholesalers in its network before The Coca-Cola Company acquired the distribution rights following a $2.15 billion investment in parent company Hansen Natural Corp. in 2014.
Berardi, along with his wife Alyssa Warnock, who serves as the brand’s creative director and designer, and vice president of business development Dan Craytor, will continue to oversee day-to-day operations. Michael Taylor, the current vice president of A-B’s North America Zone, will oversee the company’s partnership and report to VP of sales Alex Medicis.
“We are thrilled to partner with a company that shares our vision for where we can take Hiball Energy and Alta Palla in the future, and brings real passion and dedication to their work every day,” Berardi said in a press release. “This deal is the beginning of a new and exciting chapter for me and my team, and I can’t wait to get started.
In an interview with BevNET, Anheuser-Busch CEO João Castro Neves said he believed Hiball and Alta Palla would accomplish two objectives: it gives the company an opportunity to tap into demand for products made with organic ingredients, and it allows A-B to capitalize on a shift toward low-sugar energy drinks.
“I think what Hiball has done is bring energy, but in a better way, and then they saw the opportunity to go into sparkling water,” he said. “I see both those segments as two that Hiball and Alta Palla can tap into through ingredients, through the right sourcing, and through their passion and their social media execution. They always find that angle that the other guys in the segment have not been able to do.”
Berardi said that Hiball had declined numerous offers for the company in the past, but that A-B represented a partner that was “100 percent aligned with our passion.”
“We’ve been a very lean and mean team, and we’ve never had outside institutional capital,” said Berardi, adding that the company would retain all of its current 20 employees. “To have all this operational expertise and marketing support and this amazing wholesaler network, to be fully aligned and part of the same family with the same goals, it’s going to take the Hiball and Alta Palla brands to the next level.”
While Castro Neves said he did not consider Hiball a replacement for Monster, he acknowledged that A-B’s past experience with energy drinks helped inform the decision to acquire the brand.
“AB has been in non-alcohol in many countries,” he said. “We learned how to do the ‘and,’ so winning in [alcohol] and in non-alcoholic, it has to be a complement and not be a distraction. If we know that we can do it outside of the U.S. and that we’ve done it once well [in the U.S.], it gives us confidence that we can do it again.”
Berardi noted that Hiball and Alta Palla are currently distributed in all 50 states, mainly via natural distributors such as UNFI and KeHe. He added that nothing would change in the near term for its retail partners and that both brands’ products will continue to be made at existing U.S. co-packing facilities. The transaction is expected to close during Q3, which Castro Neves said would allow A-B time to transition Hiball and Alta Palla to its wholesaler network and plan for future growth.
“We learned a lot also with the craft beer acquisitions on how to have the right expansion strategy,” he said. “You don’t want to go too fast, you don’t want to go too slow. So we’ll continue to build the brand in the same fashioned way that the HiBall team and Todd has done for the past years.”
In a press release, David Stokes, the CEO of Grey Eagle Distributors and the chair of A-B’s wholesaler advisory panel, said, “We are thrilled to partner with Todd and the rest of the Hiball team. Hiball Energy and Alta Palla are great additions to our developing no-alcohol portfolio, and we have been asking A-B for a partnership opportunity just like this. Adding these outstanding brands to our wholesaler system increases the breadth of our product portfolio and strengthens our network as we offer more innovation to our customers.”
The deal with Hiball is A-B’s second non-alcoholic play in the U.S. Last June, it agreed to manufacture and distribute a ready-to-drink version of Starbucks’ popular Teavana product. That partnership officially kicked off earlier this year.
With the ink on the deal still drying, Berardi said he was already eager to get started.
“Today we celebrate, tomorrow we get back to work,” he said.
Note: A version of this story also appeared today on Brewbound.