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Alc bev deal landscape unusually fertile in 2026. And beer cos are often buyers of non-beer assets, as they look hard for new growth opportunities. Activity ramped up significantly in recent mos and keeps morphing in new directions. So far, spirits RTDs are mainly where the action is for malt bev suppliers in 2026. Three notable deals totaling over $1 bil announced in just last 5 mos. And others are reportedly in works. Talks about a much bigger transaction between two leading spirits players, Pernod and Brown-Forman, publicly acknowledged but fell apart earlier this week. A larger Sazerac offer ($15 bil in cash) perhaps not what B-F wants at this time. But if a Brown-Forman deal does happen, that would mean big-time changes in competitive structure of spirits biz, as spirits cos wrestle with softer trends, excess inventory and changed distribution model. Indeed, the landscape for wine and spirits distribution is utterly transformed, as multiple beer distribs pick up significant wine and spirits assets from RNDC. The #1, #2 and #4 malt bev suppliers each bought spirits or wine RTDs in recent months. First, AB bought BeatBox, paying $490 mil for 85%, an implied valuation of $575 mil, with extra payout possibilities. Then, Atomic sold for $275 mil to MC, followed by Finnish Long Drink sale to MAB (Mark Anthony Brands) for $325 mil, including earnouts. Other strategics are also shopping. Who's next? Elsewhere in beer, a significant craft deal: Firestone Walker bought Stone brand and select hospitality assets, but not its breweries. That makes Firestone a much larger, more efficient play in craft, especially in Cali, while Sapporo simplifies its biz and hones its focus on Sapporo brand which will be made solely in Richmond, VA. On a much smaller scale, George Clooney's non-alc beer brand Crazy Mountain raised $15 mil in capital led by private equity firm with plenty of bev experience, CAVU Consumer Partners.Rapid Unraveling of RNDC; Big Mkts Often Go to Big Beer Distribs In wine and spirits distribution, we are witnessing history almost in real time: the rapid unraveling of RNDC, formerly the 2d-largest wine and spirits distrib. RNDC revs peaked at $12 bil, but it reportedly had become unprofitable. After latest round of deals, not much may be left. Who are among the biggest beneficiaries of this unraveling? The biggest beer distributors: Reyes Beverage Group, Columbia and Manhattan. That's called convergence. Recall, RBG in process of acquiring RNDC brands in 10 states + DC, including major mkts like FL and TX, expected to close at end of May. And it previously plucked most of best brands from RNDC in CA. Now Columbia has letter of intent to purchase "certain wine and spirits distribution rights" from RNDC in OR, WA and an "asset arrangement" in AK. And Manhattan Beer and Bev has letter of intent to buy RNDC brand rights in NY state, becoming a statewide wine and spirits house. Martignetti has LOI to buy RNDC's control state biz across 17 states. But Brown-Forman is going elsewhere in 11 of those control states, including Johnson Brothers in 6, SGWS in 3, Superior in OH and Great Lakes in MI. RNDC is also reportedly in advanced discussions with an unnamed potential buyer for its Plains states operations, which INSIGHTS understands may also be a beer distrib, while working with its joint venture partners in IL, KY, IN, and MI to determine the best path forward.Convergence Between Alc Bevs and Non Alc Bevs "Inevitable," Sez Nik There is an even broader form of convergence coming, according to RBC managing director Nik Modi, speaking at NBWA's BREW Forum. "I don't think we're gonna have a non-alc and alc industry that's separate 3-5 years from now," Nik said. "The consolidation is already happening at the supply chain level. It's gonna drive manufacturer consolidation. It's inevitable" and "I think we're just at the beginning." Nik again predicted Pepsi refranchising of its bottlers (potentially some to beer distribs) to better compete with Coca-Cola. Next day, Pepsi announced expanded agreement with Carlsberg for multiple countries in Baltics, starting in 2029. Carlsberg is about one third non-alcs following its acquisition of Britvic, completed last yr, making it further along on this form of convergence than any other global alc bev supplier.Accelerated Deal Activity Necessary for Growth in Tuff Environment What's led to pick up in deal activity in alc bevs, moderator Caroline Levy asked panel of Wall St analysts at this week's Bev Forum. Absence of population growth and pressure on their existing bizzes, according to Evercore ISI managing director Robert Ottenstein. That's on supplier side. "Mainstream products are fairly mature" without tailwind of population growth. "That makes things really tough" and cos "need to&hellip; develop a different business model." M&A is one "way to get growth." With ability to take pricing "moderated" and volume "quite challenging," companies are "seeing opportunities" to "take stakes," form distribution agreements, "buy certain businesses," but there's also "dare I say it, desperation to some extent," said Goldman Sachs managing director Bonnie Herzog. CEOs are under "a lot of pressure" to "ultimately accelerate the top line." And that's why there's "accelerated" M&A, she added. Even larger transactions pop up more recently in "broader" consumer staples. Here, Bonnie mentioned Pernod and Brown-Forman deal discussions that just ended; cos are "trying to figure out an industry that's facing a lot of pressures." There's an "opportunity" to "drive efficiency and scale" thru M&A, said Bonnie. And "tuck-in, bolt-on acquisitions" are also "going to continue."

Deals in the Air; Deals Everywhere; RTDs, Distribs, Stone and Firestone, Big One That Got Away? Convergence

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