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PORTLAND, Ore. — Pabst Brewing Co. (PBC) is teaming with Craft Brew Alliance Inc. (CBA) to push the growth objectives of both companies.
Under the agreement, Pabst subsidiary Rainier Brewing Co. will begin brewing Rainier Pale Mountain Ale, as well as other Rainier brands, at CBA's brewery in Woodinville, Wash. The move goes into effect this spring.
In addition, the pact gives Pabst an option to purchase the CBA Woodinville facility at any time during the next three years.
According to the brewing companies, the agreement between CBA and Rainier provides benefits for both companies. As part of CBA's strategy to continue evolving its national brewing footprint and drive financial profitability, the company is making significant investments to increase production capability and efficiency and support its growth in key markets.
The expansion investments include increasing capacity in its largest brewery in Portland to 750,000 barrels per year and building a new 100,000-barrel brewery in Hawaii. The agreement with Rainier enables it to maximize capacity in its Woodinville brewery while pursuing these expansion projects.
"This partnership with Rainier represents an important next step in our overall brewery optimization strategy, which is focused on leveraging the unique strengths and capabilities of each of our breweries to better balance production across our footprint and support our long-term growth," said Scott Mennen, chief operating officer, CBA. "Our partnership with Blues City in Memphis has enabled us to meet consumer demand for core brands such as Kona Big Wave Golden Ale and Redhook Long Hammer IPA, freeing capacity in our Portsmouth brewery to support exciting new strategic partnerships with Appalachian Mountain Brewery and Cisco Brewers.
"As we complete our Portland expansion and continue transitioning more volume to that brewery, we have been looking for an opportunity to best utilize our production team and capacity in Woodinville," he added. "With this brewing arrangement, we not only deliver positive impact to our bottom line, we support another beloved Northwest heritage brand, which benefits the industry and beer consumers overall."
For Rainier, the agreement marks a true homecoming with the return of brewing in its home state of Washington.
"We are thrilled to be returning to Rainier's home state and to begin brewing at this wonderful Seattle facility within sight of Mount Rainier. We are excited to revive many historic Rainier beers from our archives — starting with Rainier Pale Mountain Ale, which will be offered in the iconic 16-ounce Rainier 'pounder' glass bottle," said Greg Deuhs, PBC's master brewer, who served as director of operations at CBA's Woodinville facility from 2008-2012.
CBA's Woodinville brewery, known as the Redhook Brewery, was built in 1994 and features a 200,000-barrel-per-year brewing and bottling operation. In 2015, CBA announced that Redhook will open a new brewpub in Capitol Hill in Seattle to celebrate the brand's 35th anniversary in 2016.
Under the terms of the agreement, CBA will continue to operate the Woodinville brewery and adjacent Redhook Forecaster's Pub.
Portland-based CBA is a craft brewing company. Its portfolio includes Redhook Ale Brewery, Widmer Brothers Brewing and Kona Brewing Co.
PBC has been American-owned and operated and is North America's largest privately held brewing company, with U.S. beer market share of approximately 2.5 percent in 2014. Pabst's portfolio includes Pabst Blue Ribbon as well as Rainier, Lone Star, Ballantine, Old Style, National Bohemian and Stroh's.