(In final paragraph, corrects acquirers/oqwners of Pabst Brewing)
By Lauren Hirsch
Aug 4 (Reuters) - Lagunitas Brewing Company is working with Wells Fargo & Co to explore strategic options, including the sale of an equity stake, in a deal that could value the company at around $450 million, people familiar with the matter said.
The Petaluma, California-based brewer is one of the best-known and fastest-growing brands in an industry in which young consumers are spurning traditional, well established beer names in favor of new, independent ones.
Lagunitas has been exploring strategic alternatives for several months, as its chief executive Tony Magee, a former musician and print salesman who founded the company in 1993, seeks to expand his business, the people said this week.
A joint venture is also a possibility being explored, some of the people said. There is no certainty that any deal will materialize, the people added.
The sources asked not to be identified because the deliberations are confidential. Lagunitas and Wells Fargo declined to comment.
Lagunitas’ most well known label is its India Pale Ale, a trendy bitter beer. It also makes a smoother pale wheat ale, Lil Sumpin’ Sumpin’. The company has breweries in Petaluma, California and Chicago, with one more planned in Los Angeles.
The popularity of its brands, known for the large fonts on its labels, has helped Lagunitas increase its market share. In 2014, the $19.6 billion craft beer industry saw barrel volumes rise 18 percent, according to the Brewers Association. By comparison, Lagunitas saw its barrel volume rise by 50 percent in the same year.
Dealmaking has increased in the craft brewing sector as companies seek to capture the frothy valuations that have accompanied the industry’s boom. Earlier this year, California craft brewery Firestone Walker Brewing Company announced its merger with Flemish-family owned brewery Duvel Moortgat.
Fireman Capital Partners purchased a majority stake in Oskar Blues Brewery, maker of Dale’s Pale Ale, last May. Last year, Pabst Brewing company was acquired by Blue Ribbon Intermediate Holdings, a partnership between beer entrepreneur Eugene Kashper and private equity firm TSG Consumer Partners. (Reporting by Lauren Hirsch in New York; Editing by Cynthia Osterman)