BUSINESS

Labatt Enters Craft Beer Market, Buys Mill Street Brewery For Undisclosed Amount

10/09/2015 10:08 EDT | Updated 10/09/2015 10:08 EDT
Steve Russell via Getty Images
TORONTO, ON - APRIL 8: For the first time in decades, there will be distilling in the distillery district. Mill Street has installed a gleaming new copper still in a new beer hall they're opening in the distillery district. Mill Street brewmaster Joel Manning says they will be making beer schapps from their Tankhouse and Coffee Porter beers. in Toronto. (Steve Russell/Toronto Star via Getty Images)

TORONTO — Canadian beer giant Labatt Breweries is buying Toronto-based Mill Street Brewery for an undisclosed amount as it looks to gain a bigger stake in the burgeoning craft beer market.

The acquisition of the privately held Mill Street brand will help Labatt expand the craft label into new markets, including Quebec, executives told The Canadian Press on Friday ahead of an official announcement.

"We think that this partnership will really help expand awareness of craft across the country,'' said Charlie Angelakos, vice president of corporate affairs at Labatt.

"The folks of Mill Street have built a great business and we want to continue to help them foster that growth.''

Labatt will also invest $10 million into the company's brewery operations.

"Many craft brewers in Ontario are experiencing this huge surge just to keep up with demand,'' said Mill Street co-founder Steve Abrams.

"This immediate infusion of capital will assist us in getting tanks and more equipment.''

The popularity of craft breweries has been on the rise across Canada in recent years.

According to recent findings from data research company NPD Group, the consumption of beer declined by six per cent in 2014, but craft beer servings were up seven per cent.

Overall, the study found craft and microbrew beers accounted for 17 per cent of all beer consumed at casual dining restaurants.

Labatt has already been playing in the craft brew market with a relatively low profile. The company owns Shock Top, which is sold in the microbrew department at liquor stores.

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