Tag: ABInbev

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ABInBev TV?

Just when you thought we had reached peak saturation in entertainment choices, along comes ABInBev to glue our eyes to screens since it is better than drinking their beer.

The megacorp (which doesn’t have much money for their purchased craft breweries) is creating an entertainment division, called DraftLine Entertainment which will create films, television and podcasts.

Who knows if Netflix or Spotify will want Bud sponsored content on their streamers but I can imagine a Bud Light RomCom or a true crime podcast about theft of small boutique distributors.

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Cost of One CBA

A little financial sleight of hand and suddenly a 20 million dollar fine seems like a small price to pay for the Craft Brew Alliance. ABInBev owned a minority stake in the group that includes Appalachian Mountain Brewery, Cisco Brewers, Omission Brewing Co., Redhook Brewery, Square Mile Cider Co., Widmer Brothers Brewing, and Wynwood Brewing Co. (basically just Kona and Widmer and really just Kona if you want to sit on brass tacks) had a September deadline for ABInBev to buy them at higher price A) 475 Million. That was declined and the 20 million paid so that lower price B) could be paid around 321 million.

321 + 20 < 475 sums up that transaction.

What happens now though Kona gets added to the formerly known as “High End” or “Brewers Collective” as if we were in the USSR. The other breweries on the list will too but I doubt they will last long before being spun out somehow. ABInBev has the geography and styles covered already with higher financial performers. Widmer Bros. is the odd duck here as a heritage brand with super-strong ties to Portland. It might be a target for revival for an ambitious under VP in ABInBev ranks. Or it may end up on the scrap heap too which would sad for the current oldest brewery in Portland.

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K-Cup B-Light


Get ready to waste a lot more tiny little plastic cups. SABInBev has joined forces with Keurig, the K-Cup coffee company with the intent of creating an “in-home alcohol drink system”.

Considering that the Keurig for soda aka “KOLD” went the way of the dodo and American democracy, I wonder why the company would leap back into a pool that even wasteful consumers rejected.

If they felt it was too hard to put a plastic cup into a machine when they could buy the same soda pre-mixed, who does SABInBev think will buy a beer or ____-A-Rita cups. And dear Lord on high, the taste of whatever came out would be atrocious (or as people euphemistically say, “consistent”.

But press on they will as they combine to “build on the Keurig KOLD technology and system innovations and AB InBev’s brewing and packaging technology, and evolve them within the realm of the full adult beverage category.” Notice, no mention of flavor in that lawyer-y bit of gobbledegook.

Another fun note, the “KOLD” sold for north of $350.00. I imagine an alcoholic version would have to retail for that, if not more. Who is going to spend that on a machine that will probably gather dust on a counter?

But this is for future selves to ponder. Like the jet pack and hover board, it is not a reality yet.

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Want this? Stop That.

For the mega-brew merger to go forward, along with divesting certain properties, it looks like the Federal Government also added some much needed assistance for smaller brewers. Whether it will be enough is another question.

1. The “Voluntary” AB Incentive for Performance plan is now shelved. This plan incentivized distributors who shut out brands that ABInBev did not want competing. The Department of Justice, in the settlement, wrote that it “prohibits ABI from instituting or continuing practices and programs that disincentivize distributors from selling and promoting the beers of ABI’s high-end and other rivals.”

2. Buying distributors is now capped as well. With ABInBev owning somewhere in the neighborhood of 7%, they will be barred from going over 10%. Which they more than likely will do.
Rest assured that the Brewers Association will be closely monitoring the situation. The group has been opposed to the merger of ABInBev with SABMiller from the get-go but, at least, there was some help given by the DOJ.

I have been of the opinion that if any of the industrial foreign owned breweries wanted to buy up little craft ones that it was sad to me personally but also part of the evolution into a new world of craft beer business. They could buy a brewery a month for years and not dent the overall numbers.

What I was worried about was that the beer that I wanted could be blocked from shelves or poorly handled by a distributor who was beholden to ABInBev or SABMiller. That blockage could seriously hamper the growth of a brewery.

Now we will see how well the rules are followed.

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Devil Went Down in Virginia

Start copying/pasting your anti-takeover post from months back. At this point every beer blogger in America probably has a standard blog post template for SABInBevMiller “acquisitions”.

This time it is Devil’s Backbone Brewing of Virginia that has joined the “High End” making it the eighth company in that division of the multi-national industrial conglomerate. But it is also unique from past sellers in two ways. It bucks the trend of West & Mid-West breweries and DB has been a Great American Beer Festival darling. winning many a medal but also taking brewery of the year in numerous categories as it grew to its current size.

“…national titles for GABF 2014 Mid-Sized Brewing Company and Brew Team of the Year, 2013 Small Brewing Company and Small Brewing Company Brew Team of the Year, and 2012 Small Brewpub and Small Brewpub Brewer of the Year.”

DB has two locations, their Outpost which is the main production hub and their Basecamp & Meadows which is the primary guest destination Their Vienna Lager is the flagship of their Germanic-hued line of beers.
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If you are worried about the beer quality, well either this statement will help or not, “While we are joining a creative group of craft breweries in the division, Devils Backbone will retain a high level of autonomy and continue its own authentic DNA within The High End framework,” brewery co-founder Steve Crandall explained in a press release on April 12th.

As I have explained before, don’t automatically write the latest “High End” entrant off completely. Put them on a watch list and see if the beer starts to decline or if the management or brewing team starts to leave. Some breweries have handled the transition well and others have not. Let’s hope that Devil’s Backbone doesn’t GRB it.

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Adding Anything Else? part 2

With the the fervor of a Christmas shopper in a combined Black Friday / Cyber Monday / Super Saturday addled craze, SABInBevMiller picked up three new breweries for its “High End” (for them) division. None of the lost tribe of breweries would cause a gnashing of teeth at the loss to the HE . No pick-ups that are more important than what evil the mega-industrial conglomerate could unleash in distribution and ingredient bulk buying.

In fact the important bit is that a pattern might finally be emerging out of their spending spree.

Of the seven American breweries, I would say that 10 Barrel (due to their brewing staff) and Goose Island (due to Bourbon County Stout and their sour program) could be considered top tier. The rest, especially with Dick Cantwell’s departure from Elysian, would be considered fair to a bit above average by your average beer geek. And other than clustering on the West Coast, that factor in their dating profile seems to be the dominant shared trait.

These willing victims are certainly High End for Budweiser but not for their respective states brewing scenes by any stretch. Even the two that I consider the cream of the crop Goose and 10 Barrel might be ranked in the bottom five of a top ten list for their state, Heck, I like Goose Island beers and I would rank them behind Revolution and Half Acre just in the City of Chicago alone.

It appears that the Belgian/Brazilian overlords are targeting the breweries that are big enough on quantity without being too high on the quality part of the equation. Maybe that makes the gulf between craft and light lagerland less a chasm for those selling. I think that the High End will evenutally be populated with those operations that can be understood by Bud marketers. A nano brewer operation or a brewery that doesn’t package in bottles and cans just are too far afield for SABInBevMiller to grasp.

In the long term though, I do not think that even the average craft brewery will be understood and effectively sold and marketed. The cost of buying barrels for Goose Island or financing second locations will eat into profits and will be ripe for cost cutting. There will be some economies of scale but not nearly in the dollar amounts that will be desired.

Just like the ill-fated dive into phantom craft brands that fizzled, this “High End” will eventually fade and the breweries spun off or closed (which won’t necessarily be a bad thing). There are obviously enough soon-to-be breweries to fill the gap. The bench talent is deep for craft beer.

The easier prediction to make is that more breweries will be bought in 2016.

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Firkin for February 2015

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The e-mail was tongue in cheek with an introduction of “No, we haven’t been purchased by Anheuser Busch.” That the joke would land without explanation shows that the acqusition speed of the craft arm of ABInBev has been dialed up.

Elysian Brewing of Seattle is the latest to join an Anheuser-Busch portfolio that includes 10 Barrel Brewing of Bend, Oregon, Blue Point of New York and Goose Island of Chicago.

But the mergers and acquisitions aren’t relegated to the King of Beers. Over the holiday break, the news was reported that Founder’s Brewing had sold a 30% stake in their company to the Spanish brewery concern San Miguel. Also in the foreign owned club is Boulevard Brewing which became a member of the Duvel Moortgat family in 2014.

Are these ownership changes the inevitable start to craft beer consolidation? If so, who would be a target in our region?

Both are questions that are speculative at the moment, but California breweries haven’t been immune to selling beloved local institutions with Anchor Brewing (and distilling) being sold by craft beer icon and founder Fritz Maytag to the Griffin Group.

Or will California usher in a new model for use going forward in the Green Flash purchase of Alpine Brewing of craft joining with craft. In earlier years, that has been frowned on (see example of Widmer/Kona/Redhook?) but it may be how to achieve the goals of brewing and distributing more beer without losing the craft beer cachet that is lost when selling to a larger company.

Will the business world tactic of growing bigger to make yourself to costly a purchase also come into play? Could the Torrance breweries form a conglomerate to thwart a takeover bid? That is more speculation but I wouldn’t be surprised to see The Bruery and Monkish Brewing join forces.

Because most Los Angeles breweries are still incredibly young in comparison to the rest of the country, these questions of may not be asked this year. Our locals may not (yet) be on the radar of MillerCoors or ABInBev either. But that doesn’t mean ownership will stay the same. Noble Ale Works has been forced to adapt to a changed team of ownership due to extraordinary circumstances. The late Haven Brewing and Nibble Bit Tabby both bowed to management discord of varying degrees that led to their taps being silent.

This leaves us with one more question. Perhaps the most worrying one. How will this affect the beer in your pint glass? Your loyalty to a locally owned brewery might be tested in the coming years.

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More than 10 Barrels Now

Yesterday the interwebs exploded with righteous anger and fury with the knee-jerk reaction to 10 Barrel Brewing being bought by Lex Luthor.

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Wait, they were bought by ABInBev. Craft beer fans might cheer LexCorp more at this point though. Because, we love to hate the big business beers.

We have been on this merry-go-round before. First with Goose Island, then with Blue Point of New York. The now predictable Tweets and Talking Points about being disappointed, selling-out, drinking local all reared their heads.

Here is where I stand (as of today, because I am willing to listen to rational and reasoned arguments):
You can be sad/angry/pick an emoticon about the sale. And you can have legitimate reasons why, but remember that if you were a passionate fan of their beer and loved the brew team then you have to at the least listen to why the owners sold. 10 Barrel made a video explaining why. Watch it.

Never, and I mean never, boycott a beer just because that brewery was sold. That is cutting off your nose to spite your face. And you will be doing a LOT of boycotting because ownership changes are going to happen. We went and are still going through a phase of small and local growth everywhere. Eventually, breweries will become bigger. Some may no longer be owned by the founders. Judge the beer and brewery on its merits. If neither measure up to what you want in a brewery, then move on.

Local does not equal great. And what is local? If the people who work at the 10 Barrel locations live in the community and the beer is brewed in the community and the ingredients are sourced as usual, you are going to tell me that it is not local? A brewery could be next door but bought their equipment in Germany, hired a brewer from outside the state and get all their ingredients from thousands of miles away and be considered local? Oh and they can brew crappy beer but that’s A-OK as long as they don’t mention Bud-Miller-Coors?

I have a sneaking suspicion that people are less angry at the breweries who sell then fearful of not knowing why ABInBev is buying. Are their reasons nefarious or is it strictly business. And that uncertainty fuels anger.

All I ask is for people to make a reasoned decision and not think that ABInBev is forcing us into an Age of Ultron.

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The Firkin for February 2013

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“And thus ends hate-watching’s brief, trend-piece aided reign as The Future of Television; you are now advised to find some other innocuous object that has no real effect on your daily life at which to direct unbridled, unfiltered online rage. Apricots, maybe. Apricots: What an asshole fruit, right?”

What does that hilarious piece of writing from the AV Club have to do with beer?

Well, it is parallel to the popular sentiment of hatred towards the Big Boys of Beer which reached a higher peak when the U.S. Department of Justice thwarted ABInBev’s plan to buy the portion of Grupo Modelo that they don’t already own.

It seems the Bud-Miller-Coors troika are hated simply for existing in our universe.  Now, I have written that without their blind ignorance of the fact that they were creating a market for craft beer drinkers by producing only watered down corn lager, we wouldn’t have the growing community that we do.  And that we should thank them for not “getting it”.

But I sense a certain amount of the hatred pointed at them and to a certain extent breweries like Sierra Nevada and New Belgium is simply because they are “big”  As if “big” was the problem and not the beer being produced.  Personally, I don’t see how Grupo Modelo being swallowed up whole will shatter the beer world.  Smart farmers of malt and hops and sellers of brewing equipment have been following and supplying the craft beer scene for awhile now.  And if the price of a six-pack of Bud Black Crown and it’s entrance to taste is higher, then more people will check out craft which will suddenly look more reasonable than they already are.

But back to my main point, why is “big” equated with bad?  It is almost certainly why the Brewer’s Association continues to lump Boston Beer Co. in with nano-breweries under the craft designation.  But why do we have to avoid “big” or it’s cousins “large” and “nationwide”.  Why is that word such a bugaboo?

I would love to see a huge Lagunitas.  More of the Sucks IPA for me which I don’t believe will suffer in quality just because it is made in quantity. New Glarus and Firestone-Walker can continue to tread the smaller path which is fine too.  We truly need breweries making good, solid craft beer at all levels of the brewery size ecosystem.

That is how you combat a monopoly.  By creating a solid base of thousands of breweries that have a growing market share.  If craft beer can reach 25% or higher, then it won’t matter if Miller and Coors and Budweiser and Modelo combine to form some mega-corporation / League of Doom (MiCoBuMo?) there will be a craft counterbalance.

So let’s stop hating just for being big.  Pick a more specific reason.  Budweiser offers so many individual reasons to hate them so it shouldn’t be that hard to find one.