BrewDog (BUDG) Files for Rescuer Amid Rising Costs and Losses

BrewDog (LSE: BUDG) has initiated a sale to a strategic buyer as it faces mounting tax and operational headwinds, with restructuring firm AlixPartners leading the process. A rapid deadline for indicative offers is expected. The company cited higher alcohol duty, impending business rate hikes, and a cost-of-living squeeze as key factors pressuring sales growth and margins. Sales growth slowed to single digits in 2024-25 as younger drinkers shift away from craft beer, while pubs and bars continue to ax its beers at a pace that has led to thousands of pub exits. Financials show a £37m loss on £357m revenue for the 2024-25 fiscal year, amid energy price volatility and a £213m TSG-backed investment saddled with an 18% compounding return covenant effectively creating over £800m in debt. Crowdfunding backers could receive little to nothing in any sale. Potential bidders include Heineken, Asahi, ABInBev, Carlsberg, and TSG itself, with a breakup of breweries by region and hiving off its 72 bars considered. The company remains the UK’s number one independent brewer and has closed over a dozen bars in the past year while pursuing a strategic exit.