Asahi Buys Grolsch, Peroni & Meantime

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Business Insider is reporting that Anheuser-Busch InBev, who’s in the process of closing the deal for SABMiller, agreed to sell off Grolsh, Peroni and Meantime Brewing, which is part of SABMiller’s portfolio, most likely in order to smooth the regulatory approvals necessary to close the transaction. In fact, this deal in contingent on the other one, so that if the ABI/SABMiller deals fall apart, then this one won’t go through either and they’ll remain part of SABMiller.

SABMiller posted a short press release today:

SABMiller plc (“SABMiller”) has been informed by Anheuser Busch InBev SA/NV (“AB InBev”) that following its announcement on 10 February, it has accepted the binding offer from Asahi Group Holdings, Ltd (“Asahi”) to acquire certain of SABMiller’s European premium brands and their related businesses (excluding certain US rights), following completion of the relevant employee information and consultation processes applicable to the sale of these brands and businesses.

The acquisition by Asahi of these premium brands and related businesses (comprised of the Peroni, Grolsch and Meantime brand families and related businesses in Italy, the Netherlands, the UK and internationally (“the Business”)) is conditional on the successful closing of the recommended acquisition of SABMiller by AB InBev as announced on 11 November 2015, which itself contains certain regulatory pre-conditions and conditions, and the approval by the European Commission of Asahi as a purchaser of the Business.

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Patent No. 20120093992A1: Apparatus And Method For Stripping Wort

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Today in 2012, US Patent 20120093992 A1 was issued, an invention of Peter Gattermeyer and Christian Dorr, assigned to Krones Ag, for their “Apparatus and Method For Stripping Wort.” Here’s the Abstract:

An apparatus and a method for stripping wort, with the apparatus including a receptacle that has a wort inlet and a wort outlet, and a heater on the side wall of the receptacle as well as a distributor device which applies the wort to the heating surface of the heater, such that the wort runs down the heating surface as a film.

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Patent No. 2155134A: Fermentation Process

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Today in 1939, US Patent 2155134 A was issued, an invention of Walter Karsch, for his “Fermentation Process.” There’s no Abstract, although in the description it includes this summary:

This invention relates to a fermentation process for the production of alcohol from liquids containing carbohydrates.

The invention provides that the total quantity of yeast shallrbe led positively and continuously in a circuit through a fermentation system consisting of a mixing device and a separating device in this wise that the total quantity of .yeast is moved unidirectionally from the mixing device to the separating device and back to the mixing 5 device. Preferably, after a predetermined controllable time, each yeast particle passes through the separating device and thus comes in contact, with fresh particles of sugar. The yeast is thus for a short time only free from the material to be fermented. The fermented liquor, after a predetermined controllable time, and after once traversing the fermentation system, leaves the said system beyond the separating device. It has been found that yeast can operate continuously in this process because it is removed as rapidly as possible from the conversion products formed. The loss of yeast cells observed with discontinuous fermentation practically does not occur in the present process. The mixing oi the yeast and of the liquor to be fermented is as intimate as possible, so that the conversion of the sugar to alcohol and to carbonic acid is effected with the greatest rapidity. At the exchange surface–the yeast membranes-by the intimate admixture the conversion products formed are withdrawn and new sugar molecules added.

By the flow through the fermentation system in the direction from the mixing device to the separating device it is further ensured that each yeast particle is separated positively after a predetermined time from the conversion products and is mixed with fresh sugar particles. No yeast particles can move in the fermentation system otherwise than in the desired direction, or settle, which is of great importance for the attainment of a maximum output of alcohol. Likewise the fermented liquor is led positively to the separating device, so that the result is obtained that the nocuous conversion products formed are separated as soon as possible from the yeast.

In the preferred embodiment the liquor is subjected to an after-fermentation in the interval between the mixing of the yeast with the liquor to be fermented and the separation of the yeast from the fermented liquor.

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Historic Beer Birthday: William H. Biner

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Today is the birthday of William H. “Billy” Biner (April 16, 1889-January 5, 1953). Biner was a journeyman brewer who worked for numerous breweries over his

He was born in the Montana territory to Swiss immigrant parents. His father, Theophil Biner, knoew Leopold Schmidt and even worked at his Olympia Brewery. Biner sent two of his sons, including Billy once he’s finished with a career as a boxer, to brewing school in Milwaukee. Biner’s first brewing job was at the Phoenix Brewery in Vancouver, British Columbia in 1912. He then worked as brewmaster at at least eight more breweries, from Los Angeles to Canada. The breweries he worked at included the Mexicali Brewery; the Orange Crush Bottling Company in L.A.; the Mexicali Brewing Company again after it was rebuilt following an earthquake; then the Kootenay Breweries, Ltd. in both Nelson and Trail, in BC, Canada; followed by the Ellensburg Brewing Co. in Washington, and then in 1937 he founded his own brewery, the Mutual Brewing Company. But it didn’t last thanks to World War II and supply issues, and it folded. Afterwards, he moved on to both Sicks’ Century Brewery in Seattle and the Silver Springs Brewery in Port Orchard, Washington. Finally, he ran the East Idaho Brewing Co. in Pocatello, Idaho until 1946, when he retired from brewing and bought his own bar, the Leipzig Tavern in Portland, Oregon. He stayed there until a year before he died, which was in 1953.

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Here’s his biography from Find a Grave:

William Henry “Billy” Biner was born in Boulder, Montana Territory, on April 16, 1889. He was the fifth of nine children for Theophil Biner and Juliana Truffer, immigrants from Randa, Switzerland.

Theophil Biner was a builder and an acquaintance of Leopold Schmidt, founder of Olympia Brewery. He worked briefly for Schmidt in Tumwater, Washington from 1903-1905. Later in 1905 he purchased the Phoenix Brewery in the copper boomtown of Phoenix, British Columbia. Theophil became president of the company and his sons Albert and Dan ran it.

Younger son Billy became a boxer, eventually earning the title of welterweight champion of British Columbia. In 1911 Theo Biner sent his sons Billy and Gustave to the Hantke Brewery School in Milwaukie, Wisconsin where they graduated in 1912. Billy then became the brewmaster for the Phoenix Brewery and as an aspiring artist he also designed all of the beer labels. During this time he gave up boxing for curling where he found similar success.

Billy Biner married Harriet Lynch, the daughter of diamond drilling supervisor Dan Lynch in 1914. As prohibition approached Billy wrote articles for the local paper espousing the benefits of beer. But business declined in Phoenix and he moved south to Los Angeles in 1919 to work for the Canadian Club Bottling-Orange Crush Bottling Co.

From 1924 through 1929 he served as the brewmaster for the Mexicali Brewing Company in Mexicali, Mexico. In 1929 he returned to Canada and was a brewer in the towns of Merritt and Princeton, BC. From 1929 through 1936 he served as brewmaster for the Kootenay Brewing Company in both Nelson and Trail, BC.

In 1936 Biner moved to Ellensburg, Washington where he became brewmaster at the Ellensburg Brewery through 1942. After the Ellensburg Brewery closed Biner worked as a brewer at both Sick”s Select Brewery in Seattle and Silver Spring’s Brewery in Port Orchard, WA before moving on to Pocatello, where he ran the Aero Club Brewery until 1946.

He purchased the Leipzig Tavern in Portland, Oregon in 1946 and operated it until 1952 when he moved to Los Angeles to work for the North American Aircraft Company. He died of a heart attack on January 5, 1953.

Billy and Harriet Biner had four children; Betty, Bill, Bob and Fredericka (Fritzi). Bill and Bob Biner both worked for their father in Ellensburg before becoming members of the US Air Corps during WW II. Together they flew over 100 missions and are the subjects of the book The Brewmaster’s Bombardier and Belly Gunner.

Although none of Billy’s children or grandchildren became professional brewers, his great-grandson, Charlton Fulton, is the brewer at McMenamins Mill Creek Brewery near Seattle, Washington.

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Biner with his sisters Julia and Mary Cecelia and his children Betty and Billy, c. 1925.

Phoenix Export Lager beer label
A label from his first brewery job, which he may also have designed.

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Historic Beer Birthday: William Cullen

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Today is the birthday of William Cullen (April 15, 1710-February 5, 1790). He “was a Scottish physician, chemist and agriculturalist, and one of the most important professors at the Edinburgh Medical School, during its hay-day as the leading center of medical education in the English-speaking world.

Cullen was also a central figure in the Scottish Enlightenment. He was David Hume’s physician and friend, and on intimate terms with Adam Smith, Lord Kames (with whom he discussed theoretical and practical aspects of husbandry), Joseph Black, John Millar, and Adam Ferguson, among others.

He was President of the Royal College of Physicians and Surgeons of Glasgow (1746–47), President of the Royal College of Physicians of Edinburgh (1773–1775) and First Physician to the King in Scotland (1773–1790). He was also, incidentally, one of the prime movers in obtaining a royal charter for the Philosophical Society of Edinburgh, resulting in the formation of the Royal Society of Edinburgh in 1783.”

Cullen extended the subject of chemistry beyond medicine by connecting it to many “arts” including agriculture, bleaching, brewing, mining, and the manufacture of vinegar and alkalies. In brewing, it was the very important need for cooling using artificial refrigeration where William Cullen at the University of Glasgow in 1748 made his impact, making advances crucial to the development of refrigeration for the brewing industry when he began studying the cooling effects of liquids evaporating in a vacuum, the process by which we cool foods today. He even demonstrated artificial refrigeration for the first time in 1748.

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In the Brussels Journal, in a multi-part history of beer, Cullen’s contributions are acknowledged and explained:

The principle of vacuum refrigerators is based on the fact that water in a sealed container can be made to boil if the pressure is reduced (the “boiling point” of 100 degrees Celsius refers to the situation when the external pressure equals one atmosphere; water can be made to boil at lower temperatures on a mountain top). The heat necessary for evaporation is taken from the water itself. Reducing the pressure further lowers the temperature until freezing-point is reached and ice is formed. The Scottish scholar and chemist William Cullen (1710-1790) gave one of the first documented public demonstrations of artificial refrigeration, and the United States inventor Oliver Evans (1755-1819) designed, but did not build, a refrigeration machine which ran on vapor in 1805. I. Hornsey writes in his history of beer and brewing:

“The earliest machine of this type was constructed in 1755, by Dr William Cullen, who produced the vacuum necessary purely by means of a pump. Then, in 1810, Sir John Leslie combined a vessel containing a strong sulphuric acid solution along with the air pump, the acid acting as an absorbent for water vapour in the air. This principle was taken up and elaborated upon by E.C. Carré, who in 1860 invented a machine that used ammonia as the volatile liquid instead of water….The first compression machine was manufactured by John Hague in 1834, from designs by the inventor, Jacob Perkins, who took out the original patents, and recommended that ether was used as the volatile agent. Although Hague’s machine can be regarded as the archetype for all ‘modern’ refrigerators, it never really got past the development stage, and it was left to the Australian, James Harrison, of Geelong, Victoria, to finalise the practicalities and produce a working version, which he did in 1856. By 1859, Harrison’s equipment was being manufactured commercially in New South Wales, and the first of them (which used ether as the refrigerating agent) came to Britain in 1861.”

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Although the first inventor of a practical refrigerator was Oliver Evans in 1805, Cullen invented the process in 1748 which allowed the technology to be further developed. After his public demonstration of the refrigeration effects of evaporative cooling, he described the phenomenon in “Of the Cold Produced by Evaporating Fluids and of Some Other Means of Producing Cold” (Essays and Observations, Physical and Literary, vol. 2 [1756]).

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Patent No. 34943A: Beer Measure

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Today in 1862, US Patent 34943 A was issued, an invention of Charles Chinnock, for his “Beer Measure.” There’s no Abstract, although in the description it includes this summary:

I have invented a new and improved can and measure for liquids liable to froth or foam when drawn or measured and also to separate the froth or foam from the liquid when pouring into other vessel or vessels.

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Historic Beer Birthday: George Schmitt

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Today is the birthday of George Schmitt (April 14, 1869-July 31, 1898). There’s very little about him that I could find, though I suspect the fact that he died when he was only 29 might have something to do with that. He was trained as a brewer at his father’s brewery, worked at a malt house, and became the manager of Schmitt & Schwanenfluegel Brewery, which was in New York City, near Central Park at 1065 Avenue A, between 56th & 57th.

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This short obituary was printed in the American Brewers’ Review:

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The brewery was originally known as the Henry Elias Brewery, who founded it near 15th Street & Broadway in 1855. Elias, in 1865, partnered with George Schmitt, this George’s father, and became known as Henry Elias & George Schmitt Brewery, a.k.a. the Central Park Brewery (and was readdressed to 1065 Avenue A, between 56th & 57th). In 1868, Schmitt partnered with Christian Koehne to keep it going and it became the Schmitt & Christian Koehne Brewery. Then in 1885, Koehne left and Louis Von Schwanenfluegel came to the business and it became known as Schmitt & Schwanenfluegel Brewery, which it remained until it closed in 1906. During that time it was also known as Consumers Park Brewing Co. and also Central Park Brewery.

According to 100 Years of Brewing, the chronology is slightly different:

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NBWA Brewery Count Over 4,800

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Some very interesting analysis from the NBWA, and their economist Lester Jones, about the number of breweries in America. Lester’s analysis uses slightly different metrics from the TTB and doesn’t define craft breweries as narrowly as the BA, and also the TTB doesn’t distinguish exactly what mat beverages are being made, if they’re licensed as a brewery then they’re included in the data. Those difference in calculating show the NBWA’s number for how many breweries there in America is 4,824, or over 550 more. But even more remarkable is that based on the number of “permitted breweries on record” at the TTB by the end of last year, that number could swell beyond 6,000, which seems absolutely crazy. The number is California alone, at 788, is just shy of 800. Sheesh!

Here’s the entire analysis below since the whole summary is worth reading:

Each year, the NBWA requests data from the TTB on tax paid withdraw volumes by size of brewery. Once again, this year’s TTB data provides some interesting brewing industry insights into the dynamics of the U.S. brewing industry. This data also is helpful for us to supplement the Brewers Association data on overall independent craft beer growth and brewery count. According to the BA, craft brewer volumes grew by 13 percent to 24.5 million barrels in 2015. The BA also reported 4,269 total operating breweries for 2015. As with all statistics, how the numbers are collected and reported can vary across organizations. In our industry, the numbers also change quickly.

As of April 2016, the U.S. domestic brewing industry had 4,824 reporting breweries according to the TTB. As with the BA’s brewery count of 4,269, this number is expected to change as additional new brewers are counted that may not yet have been fully recognized and/or reported by either the TTB or the BA data. The data presented below is for all types of malt beverage manufacturers and recognizes only the individual facility, not the ownership or control group.

Highlights from the 2015 TTB brewery count data include:

  1. The small brewer group (making less than 7,500 barrels) accounted for less than 2 percent of all domestic volumes yet accounted for 93 percent of all breweries. The smallest of this group has 566 breweries reporting less than one barrel of production each in 2015. These super small brewers can thank the contracting brewing industry for helping them sell almost 100,000 barrels – a figure well beyond their reported production capacity.
    The medium brewer group (making between 7,501 and 60,000 barrels) is a much smaller group consisting of 246 breweries, but these few breweries account for 1.6 times more volume than the 4,475 breweries in the small brewer group.
  2. The large brewer group consists of only 82 breweries making between 60,001 and 1.9 million barrels. This is a unique group within the industry as they pay the mixed rate federal excise tax of $7 for the first 60,000 barrels and $18 on each barrel over 60,001. While a much smaller group of only 82 breweries, they collectively produce more than four times the amount of beer as the medium brewer group. The large brewer group also has the largest range of production volumes and saw the fewest number of new entrants (17 breweries) into its ranks in 2015.
  3. Finally, we get the extra-large group. This is a group of only 21 breweries that produce more than 84 percent of all domestic beer – more than five times the amount made by all 4,803 combined. The closing of the MillerCoors brewery in Eden, North Carolina, will reduce this class of brewers by one in future reports and will take a significant-sized brewery offline for the first time in many years.
  4. The industry added around 1,500 new breweries in 2015 – that is equivalent to four new breweries a day entering the marketplace. As a highly capital-intensive business, starting small is the name of the game. Growing a beer brand takes a long time, and economies of scale are earned over decades. The largest U.S. breweries have been in operation for decades, and economies of scale should help maintain the beer volumes even in the face of declining per capita beer consumption.
  5. With more than 6,000 permitted breweries on record at the end of CY 2015, 2016 is set to be an even more competitive year for the brewing industry. Just as economies of scale drive the brewing side of the industry, logistical expertise and local market insights drive the efficiencies inherent in beer distributor networks. Working together and maximizing their comparative advantages, brewers, distributors and retailers will deliver unprecedented choice and value to American beer consumers in 2016.

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ABI Buys Devils Backbone

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In what’s becoming almost routine news, Anheuser-Busch InBev announced this morning the acquisition of Devils Backbone Brewing of Roseland, Virginia.

Here’s the press release:

Today, Anheuser-Busch announced an agreement to acquire Devils Backbone Brewing Company, the leading and fastest-growing craft brewery in the state of Virginia. Devils Backbone will be the latest partner to join the diverse portfolio of craft breweries within The High End, the company’s business unit comprising unique craft and import brands.

“I am extremely pleased to announce the partnership of Devils Backbone Brewing Company with Anheuser-Busch. 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,” said Steve Crandall, co-founder and CEO of Devils Backbone Brewing Company. “The existing management team plans to stay on board for many years, while continuing to innovate and bring locally crafted Virginia beer to the nation.”

In 2008, founders Steve and Heidi Crandall opened the doors to Devils Backbone Brewing Company in the Virginia Heartland, after being inspired by a ski trip to northern Italy in 1991 where they had their first taste of Germanic style beer. After success with the first brewpub, Basecamp, the decision was made to break ground on the Outpost facility, in Lexington, Virginia. Originally projected to produce 10,000 barrels of beer in its first ten years, the Outpost produced almost 45,000 barrels in its first three. Steve credits much of this early success to the excellent network of distributors within his system, which is weighted heavily towards Anheuser-Busch.

“I congratulate Steve and Heidi Crandall and the entire Devils Backbone team as they partner with Anheuser-Busch,” said Virginia Governor Terry McAuliffe. “Through the strength of Anheuser-Busch’s network of distributors, Devils Backbone’s award-winning craft beer will soon be available throughout the country and beyond. I want to thank Devils Backbone for their immense contribution to Virginia’s world-class craft beer industry, and I look forward to the additional exposure for Virginia as a leading state for craft beer lovers.”

Today, the Outpost Brewery & Taproom in Lexington serves as the primary production brewery while the Basecamp Brewpub & Meadows in Roseland, serves as a visitor destination. Devils Backbone takes full advantage of the scenic 100-acre Basecamp property surrounded by the Blue Ridge Mountains, offering a variety of opportunities for guests to enjoy the outdoors. In 2015, the two locations hosted more than 500,000 guests.

“Devils Backbone has captivated beer drinkers in Virginia since opening its doors eight years ago,” said Felipe Szpigel, President, The High End. “From the beginning, they have shown creativity and talent with the great beers they brew, and they’ve been able to use the authentic offerings at Basecamp Brewpub & Meadows to cultivate a fun, outdoor lifestyle that resonates with everyone. Pair these qualities with dynamic leadership and a dream to do something bigger, and you have the recipe for an even more promising future.”

While best known for its flagship Vienna Lager, which accounted for nearly 60% of Devils Backbone volume in 2015, the portfolio also includes other award-winning year-round favorites like Eight Point IPA and Schwartz Bier. Developing beers with personality and individual integrity of flavor has helped enable Devils Backbone to win four National titles: 2014 Great American Beer Festival Mid-Size Brewery & Brew Team, 2013 Small Brewing Company & Small Brewing Company Brew Team, 2012 Small Brewpub & Small Brewpub Brewer, 2010 World Beer Cup Champion Brewery, and the Virginia Craft Brewers Fest Best of Show medals in 2015, 2014, 2013 and 2012.

First Beverage Group acted as financial advisor to Devils Backbone Brewing Company. Anheuser-Busch’s partnership with Devils Backbone is expected to close in the second quarter, subject to customary closing conditions. Terms of the agreement were not disclosed.

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Scranton Media Family Buys Flying Fish

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I somehow missed this news, which seems to have come out without too much fanfare a few days ago. Maybe we’re becoming desensitized to brewery M&A? Certainly Twitter wasn’t abuzz with the news. Flying Fish Brewing, one of New Jersey’s earliest small brewers, was bought by the Lynett and Haggerty families, who own Times-Shamrock Communications. They own a dozen newspapers and eleven radio stations. On April 8, they announced that they’d bought a controlling interest in the Somerdale, New Jersey brewery, though the deal was quietly done a month earlier, on March 11.

Flying Fish was founded in 1995 by Gene Muller. They started in Cherry Hill, but moved to larger quarters in Sommerville four years ago.

According to the Scranton Times-Tribune (one of the papers owned by the family), this is how it went down.

The family’s expertise in marketing, events and promotions will help the brewery continue to grow and expand its footprint, said Bobby Lynett, manager of L&H Brewing Partners, the entity that now holds a majority interest in Flying Fish. They declined to disclose the cost of their acquisition.

“Flying Fish is a nice brewery with good people and a great product,” said Mr. Lynett, a publisher of The Times-Tribune. “We want to help it grow.”

Flying Fish currently employs 33 people who produce about 24,000 barrels of beer each year.

Gene Muller, founder of Flying Fish, said he began looking for new partners when some initial investors began to cash out on their investment in the company. He joked that the Scranton family emerged as a good fit “because they are Irish.”

Mr. Muller, 61, believes Flying Fish will benefit from events and other business interests of the Lynett-Haggerty families, whom he refers to as “The Scranton Guys.”

“There are obvious synergies,” he said. “We saw an opportunity to inject some enthusiasm into the company and take care of our initial investors. The Scranton Guys are part of a 100-year-old company. They understand the long-term horizon.”

The capital for L&H Brewing Partners came from some individual family members and Elk Lake Capital, set up by the family to invest in non-media companies to add diversity to the family’s holdings beyond Times-Shamrock’s media holdings of newspapers, radio stations and outdoor advertising. Elk Lake already owns a land-surveying company and water-testing company.

Toasting the Class of '96: Greg Koch, Mark Edelson, Bill Covaleski, Tom Kehoe, Gene Muller & Sam CalagioneAt a Philly Beer Week event celebrating the Class of '96: Greg Koch, Mark Edelson, Bill Covaleski, Tom Kehoe, Gene Muller & Sam Calagione.