TOKYO -- Kirin Beer will take a 30%-plus stake in Yo-Ho Brewing, becoming the first major Japanese brewer to join forces with the country's growing craft beer movement.
Based in the mountain resort town of Karuizawa, Yo-Ho has become Japan's biggest name in craft beer with Yona Yona Ale and a steady stream of other unique brews. Output surged by half on the year in the eight months through August.
Kirin sees the move as a way to diversify its lineup and reach out to new segments of drinkers. The maker of Ichiban Shibori is expected to invest more than 1 billion yen ($9.2 million) in Yo-Ho, buying shares from parent company Hoshino Resort and in a private placement.
Yo-Ho will retain management control but consign around 40% of its production to Kirin. The brewers will cooperate in shipping, procurement, product development and online promotion.
Yo-Ho has achieved double-digit growth in a domestic beer market that has shrunk in nine straight years. Though small compared with industry giants Kirin or Asahi, its 2013 output topped 240,000 cases (one case is equal to 20 633ml bottles.) Yo-Ho is also forming partnerships with retailers, such as convenience store operator Lawson, which will begin selling jointly developed beer nationwide next month. The alliance with Kirin will help Yo-Ho keep pace with rises in demand.
Kirin plans to launch its own craft beer business, Spring Valley Brewery, next year, aiming for around 20 billion yen in sales by 2020. It will set up microbreweries complete with pubs at its Yokohama plant and in Tokyo's Daikanyama, a neighborhood of cafes and boutiques.