Irn-Bru maker buys minority stake in zero-abv ‘spirit’ Stryyk
Funkin cocktail mixers and Irn-Bru owner AG Barr has acquired a 20% stake in Elegantly Spirited, producer of zero-alcohol ‘spirit’ Stryyk, for £1 million (US$1.2m).
The deal marks Scottish soft drinks group AG Barr’s first move into the non-alcohol ‘spirits’ sector.
Elegantly Spirited “seeks to capitalise on the growing demand for non-alcoholic adult drinks” with its Stryyk brand. The company was formed by Funkin founders Alex Carlton and Andrew King.
The zero-alcohol Stryyk range targets 18-35-year-olds who “choose not to drink alcohol, are having a night off or mixing up their night”.
The range launched in July 2018 with two products: Stryyk Not Rum and Stryyk Not Gin. Stryyk extended its range in December with the launch of Stryyk Not Vodka.
As part of the deal, AG Barr’s Funkin subsidiary has entered into a long-term agreement to act as the exclusive UK distributor for Elegantly Spirited’s products, in addition to the initial £1m investment.
Carlton said: “We are delighted to partner with AG Barr and also collaborate with Funkin, a business very close to my heart. The agreements make great sense strategically and could not have come at a better time.
“Demand for zero-proof spirits is going through the roof and I am confident our liquid is the best in class and our proposition easily understood. The future is bright and super exciting.”
Roger White, AG Barr chief executive, said: “More and more consumers are seeking a drink that adds positively to their social experience but without the side effects of alcohol.
“We’re very excited to be involved in both investing in and growing the Stryyk brand in this new and fast-moving consumer category.”
AG Barr, which also owns Strathmore water and soft drink brands Rubicon and Rockstar, acquired Funkin for £16.5m in 2016. The brand, which produces fruit purée, syrups and ready-to-drink canned cocktails, has “grown strongly” in the cocktail market, according to AG Barr.
King continues to be involved in the Funkin business since the transfer of ownership and will remain Funkin’s executive chairman.
As King is a related party of AG Barr, the minority stake acquisition is subject to modified requirements under the listing rules of the Financial Conduct Authority.
The alcohol-free ‘spirit’ trend was kickstarted by Seedlip in 2015, which has since launched a non-alcoholic apéritif range. Since the launch of Seedlip, the sector has continued to grow with a number of players entering the category including Pernod Ricard and William Grant & Sons.
In June 2018, Diageo-owned Gordon’s created two “ultra-low-alcohol” pre-mixed gin and tonic sparkling beverages and brought out a low-abv botanical range for its Ketel One Vodka in May.
Earlier this year, SB published an in-depth analysis of the burgeoning low- and no-alcohol ‘spirits’ market, looking at how the market for lower-abv drinks has changed, and how it will develop in the future.