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Pernod backs alcohol-free AF Drinks

New Zealand-based non-alcoholic cocktail brand AF Drinks has sold a minority stake in its business to Pernod Ricard’s venture capital division.

AF Drinks founder Lisa King
Lisa King founded AF Drinks in 2020

The investment from Pernod Ricard’s Convivialité Ventures will fund AF Drinks’ expansion in the US. The ready-to-drink (RTD) alcohol-free brand entered the States in February 2023 under the name ‘Free AF’.

The Free AF collection is composed of four canned non-alcoholic cocktails: Apero Spritz, Cuba Libre, Paloma and Vodka Spritz.

In the US, it is sold both online and on Amazon, and in Sprouts Farmers Market stores nationwide.

AF Drinks’ portfolio of 11 products can be purchased online in its home market, as well as in more than 300 grocery and liquor outlets.

AF was also the first alcohol-free brand to be served on its local airline, Air New Zealand.

Lisa King, who founded AF Drinks in 2020, said: “The team at Convivialité Ventures supports innovative brands and understands the scale of opportunity within this rapidly-growing category. Our unique product offering combined with their rich experience represents an exciting new chapter in the mission of AF.”

According to IWSR Market Analysis data, the no- and low-alcohol category grew by more than 7% in volume last year across 10 key markets, surpassing US$11 billion in value. The US is expected to increase by 25.4% through to 2026, AF Drinks noted.

Non-alcoholic RTD products in the US are predicted to rise by 18% in volume between 2022 and 2026, driven by pre-mixed cocktails, the IWSR revealed last month.

“AF Drinks has an exciting value proposition and great line of products in the emerging ready-to-drink non-alcoholic beverage category,” said Brandon Yahn, Convivialité Ventures partner.

Financial terms of the deal have not been disclosed. It is the second investment from Pernod’s Convivialité Ventures arm in the past month, following the company’s acquisition of a minority stake in spirits distribution system EcoSpirits in May.

AF is not the only alcohol-free brand to receive backing from Pernod Ricard. In February 2021, the French firm took a majority share in non-alcoholic ‘spirit’ Ceder’s for an undisclosed sum.

The investment in AF was announced on the same day as Pernod’s purchase of a 90% stake in Canadian RTD producer Ace Beverage Group for US$124 million through its Corby Spirit & Wine division.

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