Anheuser-Busch InBev’s (AB InBev) US arm Anheuser-Busch is re-entering the energy drinks category through a partnership with sports nutrition and supplements group 1st Phorm.
The companies will work together to launch a new energy drinks brand in the middle of this year, with the beverage being distributed by the Bud Light maker’s wholesale partners in the US.
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The collaboration is “aimed at fueling new innovations within the rapidly growing energy drinks and related beverage segments”, according to Anheuser-Busch.
The partnership will be based in St Louis, where 1st Phorm and Anheuser-Busch’s flagship brewery are based.
US businessman and Ultimate Fighting Championship CEO Dana White will also be working with both businesses to develop the new energy drinks brand.
Commenting on the partnership, Brendan Whitworth, CEO of Anheuser-Busch, said: “Building on our commitment to consistently deliver quality and innovation, Anheuser-Busch is excited to partner with 1st Phorm, a company and brand that shares our vision and passion for creating products that meet the evolving needs of consumers.
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By GlobalDataIn a note last week, TD Securities analyst Robert Moskow said the initial brand would be known as Phorm Energy, and would be sugar-free.
Anheuser Busch declined to confirm these details when asked by Just Drinks.
Sal Frisella, CEO of 1st Phorm, said: “1st Phorm brings over 20 years of category experience and deep relationships in the sports nutrition industry and fitness community. By combining our strengths with Anheuser-Busch’s experience in beverage innovation and scale, we look forward to creating a new wave of energy and other beverages.
“This brings together two American manufacturers with proud St. Louis roots and complementary expertise.”
The Bud Light owner formerly held a presence in the category, acquiring Hi Ball energy drinks in 2017. It discontinued the zero-calorie, zero-sugar brand in 2023 in a bid to focus on its brands “that will drive category and company growth”.
In his note, Moskow said it was “encouraging to see ABI [AB InBev] take a bigger swing at a growth category that is highly incremental to the declining beer category”.
But he cautioned that “staking out a position in the highly fragmented $20B+ energy category will be difficult”, as AB InBev faces “a long tail of 350+ brands battling for the remaining ~30% share”.
Nevertheless, the group’s “distribution muscle and Dana White’s involvement will generate a lot of trial, especially if they advertise at UFC-related events”.
He added that the deal will “also help the company improve its relationships with independent distributors who lost access to Celsius and Ghost and suffered through the Bud boycotts”.
Last year, Keurig Dr Pepper announced its acquisition of Ghost, which includes investing $250m to take over the existing distribution agreement for Ghost energy drinks from Anheuser-Busch InBev, before selling and distributing the brand.
The company’s Bud Light boycotts began in April 2023, when transgender activist Dylan Mulvaney posted a video of a personalised can Bud Light had sent her to commemorate one year since her transitioning. However, the post quickly became a target of transphobic abuse from conservative-leaning figures in the US, leading to calls for a boycott of the Bud Light brand.
In February 2024, Michel Doukeris, chief executive of AB InBev, told analysts during a full-year earnings call that the group would continue to see growth slowly come back quarter-by-quarter following the Mulvaney controversy.
