Weber Is Merging with a Surging Grilling Rival. Here’s Why the Industry May Never Be the Same

Earlier this month, Weber and Blackstone announced they had entered into an agreement to combine their businesses. The transaction should finalize in early 2025, depending on regulatory clearance. 

Blackstone’s founder and current CEO, Roger Dahle, will take the helm as the leader of the new outdoor cooking entity. Weber’s current CEO, Alan Matula, who assumed the role in 2022 to guide the company during a period of turmoil, is slated to retire after the merger concludes.

According to the press release, each company will continue to operate in its respective home bases of Palatine, Illinois (Weber) and Logan, Utah (Blackstone).

Here’s some context on why the deal makes sense, as well as some speculation on what outdoor cooking fans should expect to come from it.

The Two Companies Hold Unique Market Positions

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Anyone with even a rough awareness of grilling is likely familiar with Weber. The company launched its first round charcoal kettle grill in 1951, and over the last 70 years, it has become synonymous with outdoor cooking for many around the globe, especially Americans. Today, the brand is widely regarded as making class-leading gas and charcoal grills at affordable and premium price points. 

According to IBISWorld and other sources, the company accounts for ~25% of all barbecue and grill manufacturing revenue globally, making it a titan in the space. But like many home goods makers that experienced surges at the peak of the work-from-home pandemic, Weber’s growth tapered as consumer habits returned to pre-pandemic norms. 

Blackstone Products, a.k.a. Blackstone, may be less familiar to anyone who is not into outdoor cooking or vigilantly avoids TikTok. 

The brand’s signature 36″ Blackstone griddle first hit the market in 2008, and for years, we’ve considered it to be the best in its class.

Today, the company has a dominant market share position in outdoor griddles (pinned at 80% by Blackstone itself as part of an IPO filing made with the SEC). It’s also expanded into a wide range of other outdoor cooking products like pizza ovens and kitchen equipment. 

Blackstone has also garnered attention in marketing circles for its social media savvy, particularly during the pandemic. In the words of its investor presentation filed with the SEC, Blackstone Products ignited “a media movement” that resulted in 490 million #blackstone views on TikTok, 100k Youtube channel subscribers, and 1.5 million griddle group members on Facebook as of 2021. 

But like Weber, Blackstone’s growth trajectory has downshifted significantly from its pandemic highs. 

Both Brands Have Had Rocky Encounters with Raising Funds via the Stock Market

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In 2010, Weber stopped being a family-owned business and sold a majority stake to BDT Capital Partners. In 2021, hoping to capitalize on the momentum of surging pandemic sales, Weber went public.

After hitting the market at a share price of $14 at the height of the pandemic spending boom, the stock fell to just $5.03 by the end of October 2022. Then, in December of 2022, BDT Capital Partners LLC, which already owned ~48% of Weber’s outstanding shares, agreed to pay $3.7 billion to buy out the remaining equity for $8.05 a share to make Weber a privately owned company again. The deal closed in February of 2023.

According to the outdoor cooking industry trade publication CookOutNews.com, which dove deep into the matter, Weber’s move to go private was critical for maintaining its current operations while also addressing its significant debt obligations. 

Blackstone Products has also experienced similar drama in recent years. In December of 2021, the same year Weber went public, Blackstone announced it would go public via a merger with Special Purpose Acquisition Company, more commonly known as a SPAC. 

According to the press release, the transaction would’ve given Blackstone approximately $95 million in proceeds, presumably to help fuel further growth among other needs.

But the deal ultimately never came to fruition and was officially terminated in late August of 2022, apparently as a result of Blackstone’s decision to “unilaterally terminate the Business Combination Agreement.” 

Combining Should Create a Stronger Financial Footing for Each Brand

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By combining forces, Blackstone and Weber will both be able to make progress in repaying outstanding debts, which theoretically should put them in a stronger position to weather the recent decline in grill and grilling-related product sales, especially compared to rivals left in similar precarious positions post-pandemic.

Some Product Line Consolidation Feels Likely Too

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2024 was a banner year for Weber product releases. The company revamped its premier line of Summit gas grills, introduced new compact travel grill models, and launched a next-generation high-heat SEARWOOD pellet grill.

But Weber also introduced a more upmarket take on the gas griddle, ostensively designed to compete with Blackstone’s core line. Weber claims that the SLATE griddle is the first rust-resistant griddle with consistent edge-to-edge heating. 

Should the merger go through, it doesn’t take a genius to think that Weber’s designs could appear on future Blackstone griddles, or vice versa.

But I also wouldn’t be surprised if Weber ratchets down its future efforts to build a robust portfolio of griddles to prevent cannibalizing Blackstone’s dominant market share. 

It would also make sense if Blackstone’s line of pellet grills slowly faded away given Weber’s recent push to enhance its offerings and generally stronger reputation in grilling overall. 

Blackstone Products also released a bevy of new products this year, many of which sit in adjacent categories to grilling that Weber has yet to enter, including a high-end pizza oven, a smokeless fire pit, and a burgeoning line of camping-focused gear, including a portable air fryer. 

The potential growth of these new categories has to be attractive to both brands, given that neither currently holds a well-established position.

Grills also tend to last between 5 and 15 years on average, which limits the category’s potential growth upside from repeat purchasing. The market penetration and saturation for grills also significantly increased during the pandemic, shrinking the pool of consumers still looking to purchase a grill today, at least compared to the recent past.

The Key Question: Specialization by Price or Category?

Weber

It’ll certainly be interesting to see what new lines of brand demarcation, if any, form between the two former competitors.

Both may still sell a wide array of products across the same categories, but perhaps in different price tiers (e.g., Weber on the premium end and Blackstone on the value side.) But as a newly combined entity, each brand could also reap benefits from dominating different pieces of the outdoor living pie.

Given Weber’s strong brand recognition both domestically and internationally, introducing various new products under the Weber name would seem like an easier path to wide consumer adoption, especially in international markets that Blackstone has yet to penetrate. 

Then again, there’s always a risk that well-publicized flops in experimental new categories could undermine Weber’s sterling reputation in grilling. 

That’s why I’d expect to see the Blackstone brand used more bullishly as a fertile testing ground for a wider range of outdoor living-related products. This only makes more sense when you consider the company’s track record of generating grassroots attention to its new products across social media platforms. 

Maybe Blackstone comes to own these adjacent grilling markets while Weber focuses exclusively on dominating grilling. Or perhaps Blackstone’s successes serve as proof of concept for Weber to build on with more premium offerings. 

I’d be surprised to see it, but there’s also a possible world where Blackstone products are rebranded as Weber items in foreign markets as a quick way to expand reach and sales. 

How It Could Impact Competition and Pricing

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The new company’s combined production, distribution, brand awareness and digital marketing sophistication should worry well-known brands with various outdoor cooking and living specialties such as Big Green Egg, Traeger, Ooni, Gozney and Solo Stove.

At least one of their respective niches feels like a prime growth opportunity for the soon-to-be merged entity, and their collective strengths could allow the company to grab market share quickly. 

Depending on production economies of scale gains, Weber and Blackstone products could also theoretically become more competitively priced. Lower prices would benefit consumers and fuel market share growth, too. 

But as with any industry with limited competition, backyard grillers could also lose in the long run.

The grilling industry had already undergone significant consolidation even before this potential merger was announced. 

In 2021, Middleby, a publicly traded and self-described leading provider of commercial and residential kitchen tech and food service solutions, acquired three separate grill makers: Kamado Joe, Masterbuilt, and Char-Griller.

The newly combined Weber and Blackstone Products entity, if approved, will tip the category even further towards being dominated by a few major players.  And as we’ve seen with everything from smartphones and wireless carriers, to airlines and streaming services, company’s in oligopolistic markets often become less responsive to the interests and needs of customers over time.

The Obvious Future Production Benefits and Worries

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Blackstone makes its products in China. Xiamen Cowell Industrial Ltd., a majority owner of Blackstone, is also the company’s lead manufacturer in the country. This arrangement helped Blackstone rapidly expand its product offerings and respond to sales growth. 

But as Wes Wright at Cookout News astutely points out, a partnership that has been a boon to date could become an existential risk to the brand if heavy tariffs on Chinese manufactured good were imposed by a new administration. 

Weber, on the other hand, has production facilities in the U.S. , as well as production partners in China. Many of its grills feature labels stating the product is “Made in the USA incorporating globally sourced component parts.” Some models feature clear Made in China tags.

A more diversified production supply chain should allow both brands to better adapt and respond to global economic and political changes.

Weber fans are also unsurprisingly speculating about how the merger could impact the future quality of Weber products. Most of the concerns assume that Weber would move more of its production overseas after completing the merger, which though possible, is far from a given.

Even without considering the potential threat of tariffs, companies across a wide range of industries experienced firsthand the downsides of relying on concentrated supply chains during the pandemic, especially those located halfway around the world. As a result, so-called supply chain resilience has become a much bigger priority than it once was.

There’s also another reason for optimism for the millions of current Weber and Blackstone grill owners and future customers.

Since outdoor grills tend to be significant investments and last for years, customers should gain confidence knowing that Weber and Blackstone will continue to exist and back their respective warranties. Both brands should also have plenty of business incentives to dream up compelling new accessories and add-ons for their growing customer bases in the years ahead. 

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