Ironhill India buys US namesake, targets 43 outlets by 2030

MUMBAI: Ironhill is raising a glass to a cross-border expansion. Ironhill India, India’s biggest microbrewery chain, has acquired and merged with its US namesake, creating a hospitality group with revenue of about Rs 450 crore, according to a Reuters report.

The Indian company acquired the Pennsylvania-based Ironhill through bankruptcy proceedings, giving it control of the Ironhill brand’s global trademark. The deal also allows the company to expand in the US without taking on locations that were making heavy losses.

“We did not take any of the locations which were in losses, which were making huge losses. We made sure we took the locations only which are around 20 per cent Ebitda,” said Ironhill India co-founder Teja Chekuri.

Ironhill India currently has about 10 outlets and plans to expand its combined network to around 43 outlets across India and the US by 2030. The company is targeting 27 outlets in India and at least 16 in the US.

The US business had struggled after an aggressive expansion under its previous ownership. Ironhill India used the bankruptcy process to acquire the brand and select operating locations, rather than inherit the loss-making parts of the business.

The company has invested a further $4 million to revive and reopen five US outlets, taking its total investment in the American business to about $7 million.

The reopened outlets are in Center City Philadelphia, Hershey, Lancaster and Huntingdon Valley in Pennsylvania, and Wilmington in Delaware. The US business had generated about $27 million in annual revenue before its closure, according to the company.

“This is not only about the brand name. The revenue will increase multiple fold and the brand value will increase because now it is a brand which is present in the US also,” said Ironhill India co-founder Sree Harsha Vadlamudi.

The acquisition also gives Ironhill India access to brewing expertise and operating practices developed in the mature US craft-beer market. The company plans to adapt American brewing processes, technology and a broader range of beer styles for its Indian operations.

“The brewing process is more efficient in the US because it has been there for decades. There are a lot of synergies,” said Ironhill India co-founder Teja Chekuri.

Ironhill India also expects the US operation to offer lessons in labour productivity and automation that can be applied to its Indian outlets.

The company plans to expand cautiously in America, initially adding two to three locations a year. It expects to have at least 16 US outlets by 2030, alongside its planned 27 outlets in India.

For the US business, the revival also means jobs and supplier relationships returning. “Bringing Ironhill back has meant bringing 500 team members and vendors back to their jobs, their regulars and to the craft they spent years perfecting,” said Ironhill director-operations Alexis Lundeen.

India’s microbrewery market remains relatively underdeveloped outside major cities, giving Ironhill room to expand as consumer spending rises and operators move into smaller markets.

The cross-border deal gives Ironhill India more than a foothold in the US. It brings global brand rights, an American operating base and brewing expertise that the company hopes will help it scale on both sides of the Atlantic.