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October 16, 2007 - Origlio Beverage Acquires Kunda Distribution Operations
In a move which sent shock waves throughout the regional beer community and directly affect the fortunes of several craft breweries, Origlio Beverage, the largest wholesaler in the five-county Philadelphia market, has closed a deal with Kunda Beverage in King of Prussia to acquire its distribution operations by January 2008.

Multiple sources have confirmed the broad outlines of the apparent sale for The Beer Yard Monday evening. The deal was the subject of countless telephone calls in local beer circles after it broke late yesterday, continuing well into the evening and early morning hours.

Insiders say that Origlio is also expected to make at least two more wholesaler acquisitions in the next few months. Conjecture is that these would be businesses located in the western and northern suburbs.

The move will add most of the major local and U.S. craft beer brands currently in the five-county market and an impressive array of high-end Belgian imports to the wholesaler's portfolio.

Origlio signaled its interest in becoming involved in the craft beer segment last year when it sought and acquired the rights to the Sly Fox brand from Kunda. The presence of some of the company's key sales personnel at the Great American Beer Festival in Denver last week added further evidence of that interest.

Local craft brands currently distributed by Kunda in addition to Sly Fox include Dock Street, Dogfish Head, Legacy, Stoudt's and Weyerbacher. Major West Coast brands such as Port, Stone and Russian River are also in its portfolio, as are several other well known crafts from across the county and many of the best known and highly prized Belgian and German labels.

A source familiar with the negotiations said that Kunda, which pulled off a major acquisition of its own in 2006 by purchasing Edward I. Friedland, Philadelphia's major distributor of craft and Belgian beers, pulled the trigger on the sale at this time to insure that its personnel would have seniority in the event of any future takeovers by Origlio.

Kunda will keep its retail outlet in King of Prussia and its importing subsidiary.

Whether Origlio will choose to keep all the Kunda brands or whether any of the breweries might object to the shift of its brand to a new wholesaler is unknown at this point.

The impact on the overall wholesale picture for the five-county region will be, at the very least, one less distribution option for breweries seeking to enter the market. In addition, an eventual shuffling and swapping of brands among wholesalers is not unusual following a restructuring as major as this one will be.--JACK CURTIN