VMG lassos $90 mln for craft-beer investment

VMG Partners, the San Francisco-based specialist in middle-market consumer deals, quietly backed an effort by the founders of Stone Brewing Co to launch True Craft, a company set up to invest in startup beer makers.

VMG Partners declined comment on a June 21 filing that listed $89.5 million raised for VMG Stone Brewing Coinvestment LP. The form lists VMG Partners III, the firm’s third buyout fund, as general partner.

VMG does not list Stone Brewing or True Craft among the portfolio companies on its website.

Behind high-profile deals for Pirate Booty, Kind Healthy Snacks, and Spindrift, VMG Partners quickly raised VMG Partners III LP in 2015 with $500 million in commitments.

The firm has formally announced some hires and exits this year, but no acquisitions or minority investments.

In July, the firm completed the sale of Babyganics to SC Johnson, and in May, the firm wrapped up its exit of Justin’s LLC to Hormel Foods. Terms of those deals weren’t disclosed. Wayne Mu, who worked on the Justin’s deal for VMG, was promoted to managing director from principal in January.

Lizzie Younkin, spokeswoman for Stone Brewing Co, declined to comment on VMG’s role in the company beyond a statement from the Escondido, California, company about the launch of True Craft.

Stone Brewing Co has not issued any updates on True Craft’s progress since the company announced it at an industry conference in April, she said.

“True Craft is built to help misfit companies stick around in a world that is designed to assimilate them like the Borg,” Greg Koch, co-founder of Stone Brewing Co, said at the time, according to a USA Today article posted on the beer company’s website.

One of the 10 largest craft brewers in the U.S. and founded in 1996 by Koch and Steve Wagner, Stone Brewing Co said it raised $100 million from an investor group to take minority stakes in craft brewers. The effort comes amid massive consolidation among the largest beer brands, while competition among independents remains fierce.

In September, Stone Brewing Co named Dominic Engels, the ex-president of POM Wonderful, its CEO, after a search stretching a year.

Action Item: Contact VMG Partners: www.vmgpartners.com/contact/

Stone Brewing World Bistro & Gardens, adjacent to Stone Brewing’s brewery operations in Escondido, California. Photo courtesy Stone Brewing.