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Dark Star MD James Cuthbertson: “There is a real value in the deal for both of us."

Fuller’s acquires Dark Star, scope to innovate

Fuller’s Brewery this week acquired Dark Star Brewing for an undisclosed sum. Here’s how they plan to move the combined venture forward.

The Sussex independent will continue to operate as a standalone business at its brewery in Partridge Green, Sussex, led by managing director James Cuthbertson. Fuller’s will sell Dark Star's brands, chiefly Hophead pale ale, and open routes to foreign markets and the off-trade.

In turn, Dark Star’s 45-barrel plant will give the family brewer greater scope to innovate with small-batch brews.

The existing brewing team will be retained, but Cuthbertson warned there may be redundancies among logistics and sales staff as synergies take effect.

“It’s the right thing for the business at the right time,” he said. “We need investment to go forward and we have been dancing with banks and thinking about crowdfunding, but none of it really worked for us.”

In recent years, Dark Star has been frustrated in its attempts to expand, with a deal on a new site falling through, and problems with waste water.

Cuthbertson revealed he had struck up a relationship Simon Dodd, managing director of Fuller’s Beer Company, who had approached Dark Star to get a better understanding of how the larger Chiswick-based firm might exploit the ‘craft’ opportunity and ease its dependence on flagship ale London Pride.

“It was like a dating game,” said Cuthbertson. “We got to know each other, discovered that we had a lot in common then ended up asking ourselves whether we could live in the same house.

“There is a real value in the deal for both of us. We can do the kind of small-batch stuff that they can’t, so it’s about Fuller’s investing in Dark Star to grow Dark Star in a way that helps them.

“There are certainly efficiencies we can find in updating our existing kit, and if small-pack volumes take off with Fuller’s help we’ll be looking at the production facility.

“The key thing for us, though, is that they’re great people to work with and they have beer at their heart. They’re giving us space to do what we’re doing rather than ‘Fullerising’ us. They do things right.

“We’ve always described Dark Star as more of a hobby that got out of control than a business, an ethos that will remain at the centre of what we do and what we’re about. After all, beer should be fun and accessible.”

Dodd confirmed “It will be James’s P&Ls at Dark Star, he will tell us what he wants and how we can help him grow the business, and we’ll bring synergies such as back-of-house systems and routes to market.

“We’ll be investing in kit, too. The brewery badly needs a new boiler and we’ll be fixing that straight away, and we should be able to do something about the waste water, too.

“I don’t think we’ll be telling them how to make hop-forward beers, and we won’t be tinkering with any recipes,” he continued. “It’s the innovation and irreverence that attracted us to Dark Star in the first place.”

One beer in particular stands out for Fuller’s.

“The brand we see big potential for is Hophead,” said Dodd. “Bottling and canning is limited at Partridge Green, but we can find more SKUs to release into the off-trade and the 82 markets we have access to internationally.”

Hophead is currently served in 10 of Fuller’s managed houses and “several” tenanted pubs, “but we won’t be rolling it out into the whole estate. Dark Star beers will only go into the right businesses.”

Dodd added that there is also a big opportunity for Fuller’s wholesale arm, Nectar, and in using Dark Star to push forward innovation.

“We’re constrained by a minimum 160-barrel run at Chiswick – though we are installing a 10-barrel pilot plant in June. But Dark Star can cope with runs of 30 barrels and can be more creative.”

Dark Star’s four tied pubs are not part of the deal. They will continue to be operated by Cuthbertson and his directors under a new name - Pale Moon Pub Company – and will continue to stock Dark Star beers, “because that’s what people come to us for,” he said.

Phil Mellows
23rd February 2018

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