Longstanding relationships helped McDermott Will & Emery and Nixon Peabody guide Thursday's groundbreaking $300 million tie-up between two craft brewing titans: the Boston Beer Co. and Dogfish Head Brewery.

Boston Beer Co. was the second-largest independent craft brewer in the United States in 2018, according to trade group the Brewers Association, while Dogfish Head ranked 13th in beer sales volume.

Nixon Peabody dealmaker Fred Grein has represented Boston Beer since its founding in 1984, while McDermott's Marc Sorini first met Dogfish Head founder Sam Calagione shortly after he opened the brewery in Rehoboth Beach, Delaware, 23 years ago. The Washington attorney crossed paths with Calagione when the latter was pouring Dogfish's beer at the Brickskeller, a pioneer for craft beer in D.C. that closed in 2010.

“The first project I did for Sam I did on a gratis basis,” Sorini said. “They formally became a client in 2000.”

Sorini and former Dogfish Head general counsel Shauna Barnes, a onetime McDermott associate, are both on the Craft Beverage Lawyers Guild's initial governing committee. The group was founded in 2016 to better serve the legal needs of craft beverage companies.

Barnes left Dogfish last month to head the alcohol practice at Virginia Beach, Virginia's Kaleo Legal.

While Sorini serves as McDermott's relationship partner with Dogfish Head, having advised the company on distribution agreements, regulatory issues and government relations, Tom Conaghan, partner-in-charge of the firm's corporate group in Washington, led the team for the deal.

Grein, who did not immediately respond to a request for comment, led the Nixon Peabody team.

Craft-on-Craft Transactions

While the two companies described the deal as a merger, Boston Beer Co.—known for its Samuel Adams Boston Lager as well as Angry Orchard hard cider, Truly Hard Seltzer and Twisted Tea—is essentially acquiring Dogfish Head. The Delaware brewery's standout beers include the continually hopped 60, 90 and 120 Minute IPAs and the sour SeaQuench Ale, along with a number of experimental offerings.

Calagione and his family will receive roughly $127 million in shares of Boston Beer stock, while Dogfish Head shareholders will also receive $173 million in cash, most of which will benefit the company's investors. Calagione will join Boston Beer's board of directors in 2020. The deal is expected to close late in the second quarter.

While the transaction pales in comparison to the $106 billion megamerger between Anheuser-Busch InBev and SABMiller from 2016, conglomerates AB InBev, Molson Coors Brewing Co., Constellation Brands Inc. and Heineken are also snapping up craft brewers, like Goose Island Beer Co., Lagunitas Brewing Co. and Ballast Point Brewing Co.

The Brewers Association defines craft as brewing less than 6 million barrels of beer annually and having less than 25 percent of ownership by a beverage alcohol industry member that is not itself a craft brewer. Sorini expects to see more combinations within this segment of the market, following an earlier progression in the American wine industry.

“It's a natural phase in the evolution of the segment,” he said. “Most of the powerhouses in California wine, they came to the place where success planning had to dictate the transaction.”