Genesee Brewery owner sold to Pa. private equity firm

This story is a joint publication partnership between the Rochester Beacon and the Cleveland Prost.

The Genesee Brewery has been through a lot in almost 150 years on St. Paul Street—Prohibition, two world wars, decades of upheaval in the beer industry, and a string of owners. Add one more to the list.

FIFCO USA, which owns the Genesee Brewery along with Labatt, Seagram’s Escapes and several other beverage brands, has been acquired by Saothair Capital Partners, a private equity firm based in Wayne, Pa.

In addition, the company is going back to the North American Breweries name, which it used from 2009 until FIFCO bought it in 2012. Peter Bodenham, a former North American Breweries marketing executive, will become CEO.

The name change makes this deal a little stranger—and more interesting—than the usual corporate ownership shuffle. North American Breweries first appeared when KPS Capital merged the old High Falls Brewing Co. with a newly acquired Labatt USA. Costa Rica-based FIFCO bought the company three years later and eventually folded it into the FIFCO USA name. Fourteen years after that, North American Breweries is back.

Saothair isn’t a beer company. It’s an investment firm that buys manufacturing businesses, including companies being spun off by larger corporations. That’s important here because the thing it just bought is a lot bigger than the Genesee brand most Rochesterians know.

Since FIFCO took over Genesee in 2012, more than $200 million has been invested in the St. Paul Street plant, according to my tally of the company’s capital projects over the past decade. Much of that work came after 2017: a new brewhouse, new fermentation tanks and filters, a separate cold block building, and a German-engineered canning line capable of filling 1,500 cans a minute. That’s not the brewery a lot of longtime Rochesterians still picture in their heads.

The campus now brews and packages beer, ready-to-drink beverages and flavored malt beverages. Roughly a quarter of what comes off its lines is contract work—beverages made for other companies’ brands. The branded side still includes Genesee, Labatt, Seagram’s Escapes, Lipton Hard Iced Tea and Bubly Wine Refresher, while contract production has become an increasingly important way to keep all that equipment busy as traditional domestic lager continues to shrink.

So when Saothair talks about buying a manufacturing company, that’s what it is getting. There’s a 700-plus-person workforce, a modernized plant, sophisticated packaging equipment and a location that puts the brewery within reach of a huge chunk of the East Coast market. Genesee is still the name Rochester knows best, but the business behind that name has changed considerably.

A firm that specializes in industrial manufacturing isn’t buying a lager. It’s buying capacity.

That helps explain why this particular buyer makes sense. It also explains why the deal didn’t come completely out of nowhere.

FIFCO USA’s Costa Rican parent sold its beverage and retail businesses to Heineken in a $3.2 billion deal that closed in January. Heineken spent months evaluating what to do with the American operation before landing on Saothair.

“After carefully evaluating a range of potential options over the past few months, we are pleased to announce this agreement with Saothair,” said Rolando Carvajal, CEO of Distribuidora La Florida, a Heineken subsidiary. “Their deep brewing expertise, long-term investment approach, and commitment to growing the business make Saothair the right steward for the next chapter of North American Breweries.”

Saothair has been around only since 2023. The firm has spent those few years buying manufacturers going through some kind of transition, including an absorbent-materials maker that had been owned by paper giant Domtar and a broadcast-equipment manufacturer called GatesAir. It closed a $300 million second fund earlier this year. A Rochester brewery being separated from a larger corporate parent fits pretty neatly into the kind of deal Saothair has been pursuing.

Then there are the people involved.

Saothair co-founder Rich Lozyniak ran North American Breweries as CEO from 2009 to 2014. Bodenham worked in marketing there from 2007 to 2014 and eventually became vice president of marketing. They aren’t walking into a company they have to learn from scratch. They know the brewery, its history and the market it operates in.

“Having led this business myself, I know firsthand what makes NAB special,” Lozyniak said. “Our focus is to provide the stability and resources this organization needs to keep serving its employees, customers and communities well into the future.”

Bodenham struck a similar note. “I am thrilled to return to North American Breweries at such a pivotal moment for the company,” he said, calling it a business with “extraordinary legacy and deep regional roots” and promising to keep investing in the brewery and its brands.

That all sounds pretty good. The private-equity part is where I think a little skepticism is warranted.

Private equity has a reputation for a reason. Firms buy companies because they believe they can make money on them, and that can mean cutting costs, restructuring operations, selling assets or eventually finding another buyer. A brewery that has been part of Rochester’s identity for generations is understandably going to make some people nervous when its new owner is an investment firm.

At the same time, it’s waaaay too early to know what kind of owner Saothair will be. The deal closed today. There isn’t much value in writing the five-year private-equity horror story before the new owners have had a chance to run the place.

What we actually know is pretty limited, and that’s probably where the story should stay for now. Saothair bought the business. Two people who know North American Breweries well are back in charge. The company says it intends to keep investing in the brewery and its brands. Beyond that, we’ll have to watch what they actually do.

That matters because the Rochester operation has become a very different business from the one Saothair’s principals knew 15 years ago. The contract-brewing side has grown. The equipment has been modernized. The plant is making products that have little connection to the Genesee name on the front of the building. If Saothair can keep finding customers for that capacity, there’s a pretty straightforward reason to keep the Rochester operation humming.

There are plenty of questions that won’t be answered by today’s announcement. Does contract brewing continue to grow? Does bringing back the North American Breweries name amount to little more than a nostalgic nod, or does it signal a change in how the company sees itself? And what happens when the people who built this business the first time get another chance to decide where it goes?

The timing is interesting. The company is bringing back a name from 2009 at a moment when the word “brewery” describes something considerably different than it did back then. The Rochester operation has spent years moving beyond its legacy beer brands and into beverage manufacturing on a much larger scale.

Now the people who once ran the place are back, too.

The name is going backward. The business isn’t.

For a brewery that’s survived nearly 150 years of change, that might be the most Rochester ending there is: the name comes back, and the business just keeps moving.

(Reporter’s notebook aside: I had four versions of this story written for the past five months or so, outlining four different buyers, and none of them were this private equity-backed buyer. Just shows you how quickly these things can change and how quietly it can be done.)

Will Cleveland is a Rochester Beacon contributing writer. A former Democrat and Chronicle reporter, he writes about beer in the Finger Lakes region and Western New York on Substack.

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