Molson Coors invests in L.A. Libations to boost non-alcoholic beverage portfolio

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L.A Libations has worked with health-focused brands such as Arya sparkling water, Aloe Gloe, Core, Body Armor and The Living Apothecary. Pic:gettyrimmabondarenko (Getty Images/iStockphoto)

Beer giant Molson Coors has announced a multiyear partnership with L.A. Libations, a beverage creator and incubator specialising in emerging brands.

L.A Libations, which was founded in 2009 and is based in California, has provided services for brands such as Zico Coconut Water, Core Water and Body Armor.

Molson Coors and L.A. Libations have already worked together on the expansion of the Clearly Kombucha brand, which Molson Coors acquired in June 2018.

The two companies will now enter into a multiyear partnership, which includes a ‘significant’ minority equity investment by Molson Coors in LA Libations as well as category-exclusive access to the company’s services. Molson Coors will also hold two seats on the L.A. Libations board.

Moving beyond beer

The equity investment gives Molson Coors a stake in new products launched by L.A. Libations and the multiyear, category-exclusive agreement gives Molson Coors access to brand creation, brand building and consulting/insights services from L.A. Libations.

With brands created by L.A. Libations, Molson Coors will have the option to purchase the brand in full. For brands it does not purchase, Molson Coors still will hold a financial stake in L.A. Libations' ownership of the brand.

Molson Coors has already set out its ambitions to grow its presence in the low/no alcohol market: both with lower alcohol beer products and with products outside its core beer zone. So far these include non-alcoholic beer Coors Edge, Clearly Kombucha and sparkling hopped water Wellraiser in the UK.  

Pete Marino, president of emerging growth for Molson Coors, said: "Developing a strong portfolio outside the traditional beer category is an important part of our long-term strategy, and this partnership with L.A. Libations enables us to pursue opportunities in this space without needing an extensive nonalcohol infrastructure.

"Their expertise in creating and nurturing brands is especially valuable at a time when much of the growth in the beverage industry is coming from brands and categories that often were non-existent five years ago."

L.A. Libations says the partnership provides an opportunity to invest additional resources in its ideas and capabilities.

"We intend to jointly become a major player in the non-alcohol space," said Danny Stepper, co-founder and CEO of L.A. Libations. "This strategic partnership with Molson Coors is an important step for our company, brands and partners, as it unlocks access to brand-building capital, capabilities and efficiencies towards utilization of a world-class distribution network."