Stone Distributing Company, a San Marcos-based craft beverage distributor and a key player in San Diego’s beer industry since 1999, has been acquired by Hand Family Companies (HFC) in a significant deal announced today. The acquisition, which also includes Classic Beverage of Southern California, integrates both companies into HFC’s newly formed Sunset Distributing subsidiary, reshaping the region’s beverage distribution landscape. The deal, expected to close in late May 2025, was facilitated by Arlington Capital Advisors, with financing from Wells Fargo and Overland Advantage.
Classic Beverage of Southern California, a Santa Fe Springs-based distributor since 1978, has been a key player in San Diego's beverage market, particularly following its 2023 acquisition of Scout Distribution’s San Diego portfolio. The deal, which closed in August 2023, added over 1 million cases to Classic’s volume, incorporating brands like Harland Brewing, Latitude 33 Brewing, Nova Brazil Hard Kombucha, Thorn Brewing, 2 Towns Cider, Eppig Brewing, Abnormal Beer Company, and Fall Brewing. This acquisition followed a strategic merger with Scout in Los Angeles, driven by Scout’s loss of JuneShine to Stone Distributing, allowing Classic—under Newport Cove Investment Holdings—to bolster its market presence while absorbing much of Scout’s San Diego workforce. Led by Chairman CJ Sanchez, Classic also expanded into non-alcoholic beverages in 2023, adding celebrity-backed brands like Prime Hydration and Alani Nu, further diversifying its portfolio in the region.
Stone Distributing, founded by Greg Koch and Steve Wagner of Stone Brewing, emerged from necessity in the late 1990s when no distributor would carry Stone’s hop-forward beers. The co-founders began self-distributing, eventually building a portfolio of more than 70 craft brands, including Modern Times, Societe Brewing, Mother Earth Brew Co., Coronado Brewing, Russian River Brewing, Maui Brewing, Victory Brewing, Avery Brewing, 21st Amendment Brewery, Beachwood Brewing, and many more, alongside hard kombucha, seltzers, and coffee.
Stone Distributing, founded by Greg Koch and Steve Wagner of Stone Brewing, emerged from necessity in the late 1990s when no distributor would carry Stone’s hop-forward beers. The co-founders began self-distributing, eventually building a portfolio of more than 70 craft brands, including Modern Times, Societe Brewing, Mother Earth Brew Co., Coronado Brewing, Russian River Brewing, Maui Brewing, Victory Brewing, Avery Brewing, 21st Amendment Brewery, Beachwood Brewing, and many more, alongside hard kombucha, seltzers, and coffee.
"Stone Distributing (SDC) was founded in the spirit of craft camaraderie," reads the company's website. "When no distributor in the late 90s would accept Stone Brewing's hop-forward beers, the brewery decided to self-distribute and brought along other specialty and craft brands for the ride. Since 1999, we have made a conscious choice to Build It to Last, striving to leave a legacy built upon sustainable growth to carry us forward. Because of SDC's ability to Lead & Disrupt we are now among the largest independent distributors of craft beverages in the country. Our culture of Doing the Right Thing ensures we work with integrity and prioritize safety at every turn. We are known for our ability to Drive Real Relationships with a diverse portfolio and best in class in service and partnerships."
Our October 2024 article highlighted the sale of Stone as part of San Diego’s craft beer decline. This follows a recent trend of diminishing a diminishing local presence in the craft beer spotlight, with giants like Ballast Point (sold for $1 billion, then offloaded for under $100 million), Modern Times (sold to Maui Brewing for $15.3 million), and Green Flash (now under Tilray Brands) succumbing to corporate pressures, leaving the city with no locally owned breweries in the Brewers Association’s Top 50.
Stone Distributing moved back to San Marcos in 2021 on S. Pacific Street, after operating in various North County locations. The company has grown into one of the largest independent premium beverage distributors in the U.S., serving bars, restaurants, and retailers across Southern California, a region where craft beer contributes over $1.2 billion annually to the local economy, according to California Craft Brewers Association's 2024 statistics.
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| Stone Distributing territory coverage |
HFC, headquartered in Clarksville, Tennessee, is a family-owned enterprise with a legacy dating back to 1946, when it began as a small Anheuser-Busch distributor. Today, HFC is led by CEO Mark Hand, a third-generation leader, and operates as one of the largest independent Anheuser-Busch distributors in the U.S., managing a portfolio that includes Budweiser, Michelob, and a variety of craft and non-alcoholic beverages. The company employs over 1,500 people across its operations and is known for its community engagement, often partnering with local charities and events to promote responsible consumption.
This acquisition of Stone Distributing follows Stone Brewing’s 2022 sale to Sapporo USA for $168 million, a move that stunned the craft beer world given Koch’s vocal stance against selling out. Although Steve Wagner and Greg Koch left Stone upon its purchase, reports at the time claimed they kept hold of distribution portion of the company. Sources suggest they later sold it to venture capitalists - a transaction kept under wraps.
This acquisition of Stone Distributing follows Stone Brewing’s 2022 sale to Sapporo USA for $168 million, a move that stunned the craft beer world given Koch’s vocal stance against selling out. Although Steve Wagner and Greg Koch left Stone upon its purchase, reports at the time claimed they kept hold of distribution portion of the company. Sources suggest they later sold it to venture capitalists - a transaction kept under wraps.
Koch had repeatedly declared, "I will never sell out," emphasizing in a 2018 interview, "Stone Brewing is sacrosanct. We’re not interested in a cash grab… We operate as an artisan." He echoed this sentiment in 2016 posts on X, stating, "Selling our company to Big Beer is not in our future. No matter the size of the check. Period."
Yet, in a June 2022 blog post announcing his departure from Stone, Koch admitted to a change of heart, writing, "I’d said it dozens of times… I 1000% meant it every single time… But I’ve softened my rigidity around this in recent years." The sale, driven by a $464 million debt to private equity investors due in 2023, allowed Sapporo to produce its beers at Stone’s Escondido and Richmond, VA, breweries, doubling production to 360,000 barrels by 2024. Stone Distributing, however, remained independent - until now.
For San Diego’s craft community, HFC’s acquisition of Stone Distributing stokes fears of further erosion. Stone Distributing’s focus on independent brands may shift under HFC’s ownership, which prioritizes Anheuser-Busch products. Local brewers fear reduced support for smaller labels, especially near high-traffic areas like Petco Park, where craft beer sales rose 15% in 2024, according to San Diego Padres Annual Report. As Sunset Distributing takes shape, San Diego’s craft beverage community hopes Stone’s legacy of supporting local brewers endures.
For more information on Stone Distributing, visit stonedistributing.com.
Originally published on March 31, 2025.