ASAHI BEVERAGES ACQUIRES STRANGELOVE TO TAP AUSTRALIA’S $2.8 BILLION SOFT DRINKS MARKET
Asahi Beverages, the Oceania arm of Japan’s Asahi Group Holdings, has bought soft drinks producer StrangeLove, a mover and shaker in the Australian premium market for mixers and mineral waters.
StrangeLove was founded in the coastal town of Byron Bay just south of Brisbane in 2013 by James Bruce and Stafford Fox. They set out to revolutionise the Australian soft drink market with eclectic and sophisticated flavours using local ingredients.
Some of the company’s products such as Tonic No. 8, Lo-Cal Yuzu and Double Ginger have become familiar to Australians as StrangeLove doubled in volume and revenue in the last two years by expanding production and distribution. Many of Australia’s top restaurants, high-end grocers and, more recently, premium Woolworths stores, now stock StrangeLove’s drinks.
Premium non-alcohol beverages on good form
Asahi Beverages Group CEO Robert Iervasi, said: “Australians want more sophisticated and lower-sugar soft drinks, which has fuelled demand for StrangeLove’s products. We expect StrangeLove to really shake things-up in the on-premise premium mixer and adult soft drink space. This deal will also strengthen our offer to retailers. They are dedicating more shelf-space to premium non-alcohol beverages.”
Asahi Beverages’ investment in StrangeLove comes as consumers increasingly choose healthier beverages. According to Asahi, these categories are driving growth in Australia’s $2.8 billion soft drinks market (groceries and convenience). Premium mixer sales have increased 40% in the past three years and adult soft drink sales are up 65%, but from a small base.
A partnership for growth
StrangeLove co-founder James Bruce commented: “It has been an incredible nine years on our own. This deal is an opportunity to speed up… with more imaginative and high-quality beverages. With their FMCG expertise and customer relationships in retail, hospitality and beyond, Asahi will help grow StrangeLove in a way we couldn’t on our own.”
Bruce added that he was impressed by Asahi’s support of other craft partners to retain their identity and foster innovation. The StrangeLove management team will remain in their roles so that the acquisition does not affect day-to-day operations. Bruce said: “We’ll continue to challenge the status quo (adding) adult flavours using real ingredients sourced, where possible, from local farmers and producers.”