• 💧 Flow Reports Q2 Improvements
• ⏪ BevNET Live Rewind
• 🏠 Basemakers Lays Foundation for Expansion
• 🏭 Athletic Brewing Expands Operations
• 🪴 Hemp Beverages Debut At Aspen Food Festival
• 🫖 DIRTEA Names Bear Grylls as Investor, Ambassador

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The biggest name in bottled water is getting bigger.

Today, Primo Water Corporation and an affiliate of BlueTriton Brands announced the two water giants have entered a definitive agreement to merge, creating a new combined entity called (temporarily) NewCo, effectively taking the largest manufacturer of bottled water in the U.S. public.

Shareholders in Primo, which is focused on bulk water and water dispensers, and owners of the Mountain Valley and Crystal Springs brands, will hold 43% of fully diluted shares in the combined entity NewCo, leaving BlueTriton’s shareholders with the remaining 57%. The water giant is expected to have combined net revenue of $6.5 billion for the 12-month period ending March 31 and will be dual headquartered in Tampa, Fla., and Stamford, Conn.

BlueTriton chairman Dean Metropolous will serve as non-executive chairman of the entity, while Primo chief executive Robbert Rietbroek will be its CEO. Primo CFO David Hass and BlueTriton COO Rob Austin will also continue in their roles at the new entity.

“The increased presence, diversified product portfolio, focus on free cash flow generation, strong balance sheet and estimated cost synergies provide the foundation for long-term value creation for our shareholders,” Metropoulos said in a statement.

BlueTriton initially formed in 2021 following the $4.3 billion acquisition of the former Nestlé Waters North America bottled water portfolio (plus ReadyRefresh) by One Rock Capital Partners and investment firm Metropoulos & Co. According to NielsenIQ, U.S. retail dollar sales of BlueTriton’s bottled water portfolio were up 1.9% to over $4.2 billion in the 52-weeks ending June 1 – trailing only the $6.4 billion private label segment.

According to Axios, publicly-traded Primo had a $3.6 billion market cap prior to the announcement of the merger, and had nearly doubled in value from this point in 2023. 

While ReadyRefresh has previously placed BlueTriton in the water jug business, Primo is poised to fully round out its capabilities in the dispenser category. Meanwhile, Primo has made reducing single-use bottle waste a key piece of its messaging, but BlueTriton has likewise sought to emphasize sustainability initiatives – launching a recyclable aluminum bottled line at Expo West this year, joining plastic-packed portfolio counterparts across all of BlueTriton’s core brands.

Check out the full story on BevNET.

Though Flow Beverage Corp. saw a reduction in Q2 net revenue due to the exit of unprofitable partnerships, the Canadian alkaline water company today posted improved gross margins and operating expenses. Here’s the top-level view:

• Net revenue in the quarter, which ended April 30, was $7 million – a 26% y/y decrease from the prior year period.
• Gross margin was 28% in Q2, as compared to 18% in Q2 2023.
• Adjusted EBITDA – a loss of $3.5 million – was the best it has been since the company went public in July 2021. 

💭 “With significant year-over-year and sequential improvements in our profitability metrics, our Q2 financial results help support our goal of reaching positive adjusted EBITDA and cash flow from operations in Q2 2024,” said CFO Tren MacDonald in a prepared statement. 

Keep an eye out for a full earnings recap on BevNET later today.

ICYMI: BevNET Live Summer 2024 took place in New York City last week. Conversations at the conference ranged from tactical insights on making tough calls, to the barriers, and benefits, of building a business as a BIPOC founder.  

With two full days of programming and plenty of beverages sampled in between, there’s plenty to catch up on. 

BevNET Insiders can access all of the recaps and replay the full event on-demand. Join us and see what you missed.

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CPG sales agency Basemakers has focused on supporting emerging brands’ retail execution since 2015. Now, the company is looking to build a full house of brand building services, starting with a new brokerage arm launching this summer.

🕺 Basemakers has grown to over 100 clients in 35 states, with 85 full time employees and plans to expand the team to over 100 by January 2025. The firm works with companies such as Olipop, Poppi and Guayaki, among others.

🛒 Building A Base In Brokerage. CEO Max Baumann said the expansion spawned from hearing partner brands’ frequent frustrations with the traditional broker models, and aims to provide a service that is more attentive and dedicated to individual clients.

🎤 Beyond brokering, Basemakers is also extending into content creation and it is preparing to launch a podcast later this year. Eventually, Baumann hopes to add venture and in-house brand incubation wings.

Read the full story on BevNET.

Athletic Brewing just secured more room to run: the increasingly popular non-alcoholic beer brand last week purchased a 107,000 sq. ft. production facility in San Diego from former owners Ballast Point.

🤝 This isn’t the two parties first deal: In 2020, Athletic bought Ballast Point’s “Trade Street” facility, directly next door to the newly acquired site. The brewery also has a production hub in Stratford, Conn. The additional manufacturing muscle brings Athletic’s total annual bi-coastal capacity to 1.35 million barrels.

🍺 Athletic told Brewbound that the new facility would receive improvements including a new packaging line, enhancements to the brewhouse, cellar, and lab.

Brewbound Insiders can read the full story.

Famous chefs and celebrities toasted with something different this year at the yearly, high-profile Aspen Food & Wine festival in Colorado after hemp-derived beverage brand Fable became the first THC-infused drink maker to be on offer at the event.

🥂 The award-winning, botanical THC cocktail brand offered samples out tastes of its alcohol alternative-positioned RTD in the Grand Tasting Pavilion.

🍹 The brand offers three varieties: Into the Woods (rosemary and peach), Best Zest (grapefruit, orange, and lime) and Night Flight (Blackberry, hibiscus, ginger and spearmint).

😬 Despite increased regulatory hurdles, hemp beverage brands remain a growing category that has seen increased consumer demand among people reducing their alcohol intake.

Functional mushroom brand DIRTEA has named global adventurer and television presenter Bear Grylls as its newest investor and brand ambassador. To kick off the partnership, Grylls and DIRTEA founders Andrew and Simon Salter went skydiving together in Switzerland earlier this year.

💭 “With Bear onboard, we’re truly excited about what the future holds, inspiring health-conscious consumers worldwide to embrace the huge number of benefits offered by the DIRTEA range and empowering people to feel good and live better,” said Andrew Salter in a statement. 

⏪ The partnership with Grylls coincides with DIRTEAS' appointment of Grant Coetzee as CEO, former COO at Huel, as well as the release of its new gummies last month.