Has BrewDog ‘quietly joined the Establishment’? asks The Sunday Times

By James Beeson

- Last updated on GMT

Criticism: Watt has come under fire for failing to treat the company’s shareholders equally
Criticism: Watt has come under fire for failing to treat the company’s shareholders equally

Related tags The times Stock market

BrewDog co-founder James Watt has come under fire for failing to treat the company’s shareholders equally in a new interview published by The Sunday Times.

The interview, published yesterday (Sunday 5 November), asks whether BrewDog’s decision to allow Watt and some other early investors to sell more of their stakes than Equity for Punk crowdfunders was another sign that the company is selling out on its so-called ‘punk’ values and joining the Establishment.

The Sunday Times​ also highlighted Watt and (Martin) Dickie’s decision to sell 22% of the business to San Francisco private equity firm TSG Consumer Partners earlier this year, and accused Watt of “sounding more like a management consultant than a carefree rebel”.

Watt has defended BrewDog against the allegations, stating that he and Dickie still make all the decisions at the company, and arguing that the cap on Equity Punks selling their shares was not reported accurately.

“No one sold more than 17.5% — myself and Martin and other A-shareholders included,” he said. “We offered equity punks the chance to sell 15%, which was the closest we could get from a rounding perspective.”

Watt claims that only 8% of shareholders were affected by the sale cap, and only 3% of the company’s 55,000 equity punks chose to cash in shares.

The BrewDog co-founder went on to admit that selling out was “always a danger” but pointed to the brewery’s outlandish approach to PR and numerous stunts as evidence that the company was still ‘sticking it to the man’.

When asked about the accusation that BrewDog had failed to treat its shareholders equally, Watt told The Morning Advertiser: ​"With our recent deal nobody sold more than 18% of their shares and Equity Punks were all given the opportunity to sell 15% of their shares to TSG at the deal valuation. This was the closest round number of shares to 18%. 

"There was a cap in place of 40 shares on this sell back but the cap affected less than 7% of our total investors. The deal with TSG and every element of the deal was put to our Equity Punks to vote on and 97% of our Equity Punks voted in favour of the deal which is why we proceeded."

In an interview with The Morning Advertiser​ last month, Watt launched a staunch defence of the price of the brewery’s beer​ in supermarkets, stating that it was “twice as expensive” as that of industrial beer.

The brewery is currently in the middle of a fifth round of Equity For Punks crowdfunding​ as it seeks to raise between £10m and £50m to fund further expansion of the brewery business. 

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