| The purchase would come at a pivotal time of growth for Maui, which was the 43rd largest Brewers Association-defined craft brewery by production volume last year: Maui Brewing has grown steadily in the past five years, from about 55,000 barrels in 2017 (55th in the U.S.) to 62,592 in 2021. Modern Times, the 48th largest Brewers Association-defined craft brewery, made a little more than 53,000 BBLs in 2021, down about -20% from 2020. The deal would allow Modern Times to continue to exist as a brand and operate its brewery within the larger Maui portfolio, which includes Maui Hard Seltzer, Kupu Spirits, and Island Soda. The possibility that Modern Times could have been disassembled and sold piecemeal under financial receivership is now off the table. WHY IT MATTERS Maui CEO and founder Garrett Marrero says he'd like to see Maui's annual production of beer, hard seltzers, and spirits (excluding Modern Times brands) reach 100,000 BBLs by the end of 2023. That would mean adding 37,000 BBLs in a year and a half—the equivalent of a regional brewery the size of Coronado Brewing Company or pFriem Family Brewers—growth that's unheard of in craft beer. Maui currently distributes to 23 states, with more markets on the way in the Southeast later this year, though 2022 is the first year the company has made sales in the mainland U.S. a priority. Its increased production capacity and its recent addition of a dedicated mainland sales team are designed to aid in that growth push. Demand is there, Marrero says, led by flagships Bikini Blonde Lager and POG Hard Seltzer, which he says have increased sales 50% year-to-date. But the Hawaii brewery has struggled to secure the materials it needs—particularly carbon dioxide and general freight shipments—to fill orders for its beer. Maui's chief operating officer Scott Metzger estimates the brewery could have sold 15% more beer this year had it had full raw materials and labor. Adding Modern Times production facilities and connections is pivotal in a territory that's already important to the company. Southern California is Maui's second-largest market, and Maui's wholesaler there is the same as Modern Times'. San Diego is also Marrero's hometown. Maui says that if the purchase goes through, no changes are expected to current production of Maui products, which are brewed in Hawaii as well in Denver through a contract-brewing arrangement with Sleeping Giant Brewing Company. The intended purchase of Modern Times would add production capacity and four taproom locations for Maui on the U.S. mainland. Marrero sees opportunity to brew some Maui beer at Modern Times, but says that to produce all the company's products, including hard seltzers and Kupu Spirits canned cocktails, would require large capital investments in the San Diego facility. "We want to take our time in that integration, should it occur, but we really did this because we see tremendous value in the Modern Times brand," Marrero says, citing the company's staff, beer portfolio, and taproom locations as key assets. This offers a growth trajectory for Maui that potentially helps it achieve bold production goals: Maui has a diversified portfolio across beer, hard seltzers, and the white-hot ready-to-drink cocktail space, which includes its line of Kupu Spirits. It's a growing company that's picking up another top-50 craft brewery for a relatively low cost relative to the production capacity and established market share Modern Times commands. This has echoes of Monster Energy's January acquisition of CANarchy, which gave Monster massive infrastructure and established sales nationally. As the on-premise continues to recover to a level at or near 2019 pre-pandemic "normal," Modern Times' mainland taproom spaces become even more important sales channels. Maui also wouldn't rule out selling Maui products at those spaces. Maui, which has hovered between $1.5 and $2 million in chain retail sales (as tracked by market research company IRI) for the past five years, also gains access to distributor and retailer relationships in California, the U.S.'s largest beer market. If the deal goes through, Maui will acquire what it calls a ready-made and well-respected lifestyle brand that spans beer production and coffee roasting. Should the purchase occur, it would guarantee a more stable future for Modern Times, California's ninth-largest brewery which last year sold just under $7 million of beer in IRI-tracked chain retail stores. Modern Times has approximately 160 employees, according to Briggs. Metzger says while Maui would like to retain as many Modern Times employees as possible, "right-sizing" the company's workforce will be important. He says it's too early to say where redundancies in the two companies' staff might be. Typically, sales positions are often an area of overlap for merging beverage companies; a combined sales force is often smaller than both companies' forces separately, but can sell a wider portfolio of products. A sales team with a portfolio of Maui and Modern Times beers, Maui Hard Seltzer, and Kupu Spirits would theoretically be more efficient in securing placements. "Certainly we want to preserve as much of that as possible but frankly they wouldn't be in this position if they had a more sustainable workforce," Metzger says. "There's a lot of work to be done to see where we can synergize." Briggs says it's important to the craft brewing industry that ownership "isn't an abstract idea," but is closely involved with the operations and daily functioning of a brewery. She says it would be beneficial for Maui (or another small-to-midsize beverage company) to acquire Modern Times—a feeling that's in line with a recent wave of horizontal mergers and acquisitions in the beer industry. "It's fun to be part of smart growth companies—not growth for any sake, but growth that creates jobs and brand resilience," Briggs told Good Beer Hunting. "We're all facing some pretty big, macro headwinds, so the more we can lean into each other and make sure this sector is running well … that would be my wish." Maui's purchase of Modern Times isn't yet a done deal, but as noted in an article by Florida-based bankruptcy and debt law firm, Van Horn Law Group, stalking horse bidders have a leg up in terms of time, both to investigate the distressed company's assets and to "partake in discussions with important vendors, customers, and landlords prior to any bidding in an effort to become better acquainted." Despite Modern Times' financial hardships of late, Maui views the brand as strong and worthy of continued investment. "We don't simply want some IP [intellectual property] and stainless steel," Metzger says. "The issues they've gone through notwithstanding, I do think it's a very beloved brand and we want to maintain that." | 
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