Boston Beer news about the company making a deal with Dogfish Head Brewery has SAM stock up on Friday.
The deal between Boston Beer (NYSE:SAM) and Dogfish Head Brewery will have the two companies merging into a single entity. The deal will have Dogfish Head Brewery cofounders Sam and Mariah Calagione taking 406,000 shares of SAM stock in the deal.
Sam and Mariah Calagione taking SAM shares in the deal will have them becoming the second largest non-institutional shareholders in Boston Beer. The only one that will be above them is Boston Beer founder and Chairman Jim Koch.
The Boston Beer new also includes the company paying out $173 million in cash to investors of Dogfish Head Brewery. The company notes that its current cash on hand and line of credit should be enough to fund the transaction.
Once the deal is complete, Sam Calagione will be joining Boston Beer’s Board of Directors in 2020. Boston Beer will continue to be lead by current CEO Dave Burwick after the merger reaches completion.
“This combination is the right fit as both Boston Beer and Dogfish Head have a passion for brewing and innovation, we share the same values and we will learn a lot from each other as we continue to invest in the high-end beer category,” Koch said in a statement about the Boston Beer news.
Boston Beer is getting advice from Nixon Peabody for the deal. Advice for Dogfish Head Brewery is coming from McDermott Will & Emery LLP, and Arlington Capital Advisors.
SAM stock was up 2% as of Friday morning.
As of this writing, William White did not hold a position in any of the aforementioned securities.
