Second Best launches new bid for BrewDog assets and investor stake restoration

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BrewDog asset bid & investor stake

Highlights

Second Best, led by James Watt, has formally offered to acquire BrewDog assets from Tilray Brands following Tilray's £33 million purchase in March.
Watt's proposal includes restoring equity for BrewDog's 'equity punk' investors and reinstating the real living wage, addressing losses of over £75 million suffered by tens of thousands of retail investors.
BrewDog continues to struggle with reputational issues, intense competition, and reported a fifth consecutive annual loss of £36.7 million for 2024.

New offer targets BrewDog assets and equity punks

As first reported by Financial Times, Watt says his new company, Second Best, has submitted a formal offer to Tilray Brands, the U.S. cannabis and drinks group that bought BrewDog's brands, brewing facilities and some UK pubs in a £33 million rescue deal in March.

In a LinkedIn post on Wednesday, Watt says a successful deal would restore equity free of charge to every "equity punk" who registers with Second Best. He also says he would reinstate BrewDog's commitment to paying the real living wage, which the company dropped in 2024, but he does not disclose the terms of the bid.

Watt previously made an unsuccessful attempt to buy parts of BrewDog in March, before Tilray completed its acquisition through a prepack administration. AlixPartners, which ran that process, says no offer was made at any stage that would have preserved the company in its entirety.

Investor losses and pressure on the craft beer business

Tens of thousands of retail investors who put more than £75 million into BrewDog between 2009 and 2021 were left with nothing after the sale. Their holdings had already been heavily diluted after BrewDog's 2017 share sale to U.S. private equity firm TSG Consumer Partners, a transaction that gave Watt £50 million.

Tilray declines to comment directly on the new approach, saying only that it is happy and excited about BrewDog's business worldwide. Chief executive Irwin Simon told The Times last month that Tilray has invested about £50 million to stabilize the brewer and remains satisfied with the purchase.

BrewDog's sale marks a sharp reversal for a company once valued at £1 billion after rapid expansion from its 2007 founding near Aberdeen. The brewer later faces reputational damage from 2021 allegations of a toxic workplace, while Covid-related pub closures, stronger competition and weakening sales momentum contribute to a fifth consecutive annual loss of £36.7 million for 2024.

Our earlier report covered the UK Financial Conduct Authority scrutinising investment firm Litani’s approach to some Aviva shareholders over a discounted mini-tender offer. Aviva urged investors to reject the bid, warning that below-market, off-market share purchase proposals can allow buyers to profit at shareholders’ expense and may leave investors exposed if communications are unclear.

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