SABMiller Rejects Buyout Offer From A-B InBev

abib sabmiller
SABMiller released a statement this morning rejecting the latest takeover offer from Anheuser-Busch InBev. You may, or may not, be able to read the statements released by SABMiller on their website, and there are some fairly scary disclaimers including language that, depending on your jurisdiction, claims that the publicly available information may not be legal to read, and in such case advise you to “exit this web page.” Which while I’m sure is required by some law, probably UK law, also feels fairly ridiculous. At any rate, quite a few news outlets, such as the Wall Street Journal, Reuters and the New York Times are all reporting on it, so it must be okay for the likes of me.

The gist of it is the SABMiller board unanimously rejected ABI’s latest takeover offer, for the primary reason that they believe ABI’s offer “substantially” undervalues their company (currently the offer values SABMiller at $104 billion), among a few other technical reasons having to do with the timing, regulatory issues and others. The current offer is for roughly £65.14 billion, which is $99.76 billion dollars.

The Wall Street Journal helpfully created a graphic showing the recent history of the potential deal as it’s been unfolding.


There’s little doubt this is not the end of it, but there will continue to be a back and forth as this high-stakes game unfolds. And it really is a game, sad to say. Apparently negotiations have been tense, which really should not come as a shock to anybody, yet you see statements like this. “AB InBev is disappointed that the board of SABMiller has rejected both of these prior approaches without any meaningful engagement.” The absurdity of that reveals the gamesmanship involved, as it plays out in the media. It’s going to be an interesting few weeks.

What The New Landscape Of Beer Might Look Like

You’d have to be living under a rock to not have seen the news that ABI was planning a takeover bid to acquire SABMiller, which might work unless SABMiller might be able to buy Heineken, thus making itself too big for ABI to get in a hostile takeover. These rumors have long been circulating so nobody who’s been paying attention to the beer industry was too surprised at these announcements.

But so far I haven’t seen too much discussion about what the beer world might look like if any of these come to pass. The online news site Quartz filled that gap by producing a chart showing that This is what the family tree of beer companies will look like if AB InBev acquires SABMiller.

Click here to see the chart full size.

MillerCoors To Close North Carolina Brewery

Thanks to declines in sales volume, MillerCoors announced today that they will be closing their brewery in Eden, North Carolina, winding it down over the next year with plans to finally close in September of next year.

According to MillerCoors’ website:

Opened in 1978, the Eden facility was the first brewery to produce Miller Genuine Draft back in 1986. Today, it’s a state-of-the-art operation with more than 500 employees and an annual brewing capacity of 9 million barrels. The small, friendly community of Eden lies near Greensboro.

Here’s the press release:

“Today we made the difficult decision to close our brewery in Eden, N.C., in order to optimize our brewery footprint and streamline operations for greater efficiency across our remaining seven breweries,” said Chief Integrated Supply Chain Officer Fernando Palacios.

The decision to close the Eden Brewery was due to significant overlap in distribution between Eden and the Shenandoah, Va., brewery, which is approximately 200 miles away. Eden has been a strong performer over the years. However, Shenandoah is better suited geographically in relation to Northeast markets and is also the newest brewery in MillerCoors network.

The Eden brewery employs approximately 520 employees. In 2014, Eden produced 7.1 million barrels of beer, which were shipped to 280 independently-owned distributors. Brands include Blue Moon seasonals, Coors Light, Miller Lite and Miller High Life. Over the next 12 months, products currently produced in Eden will be transitioned to other breweries, including Shenandoah, Va.; Trenton, Ohio; Fort Worth, Texas; Albany, Ga.; and Milwaukee, Wis.

Since the creation of MillerCoors seven years ago, volume has declined by nearly 10 million barrels. This volume loss is due to a variety of factors, including economic challenges, an explosion of choice and fragmentation within the beer business, and a dramatic change in the way consumers engage with brands. As a result of declining volume, MillerCoors breweries are operating at an increasingly inefficient capacity. While MillerCoors is taking steps to strengthen its overall portfolio to drive long-term growth in volume and share, continued volume declines are expected each of the next few years.

“We take great pride in supporting the communities where we live and work,” Palacios said. “We’ve been proud to be part of the Eden community since we shipped our first products in 1978. We will work with community leaders to make sure we continue to support the community while we are brewing beer in Eden.”

The Milwaukee Business Journal added:

Blue Moon seasonal products will be moving to the Milwaukee brewery, which already produces seasonal varieties for Leinenkugel, said Marty Maloney, a spokesman for MillerCoors. Maloney said each brewery receiving work from Eden will evaluate its own hiring needs, but the shift could add jobs or at least support the existing jobs in Milwaukee.

But decreasing sales — volume has declined by almost 10 million barrels since 2008 and the company expects the trend to continue for the next few years — mean MillerCoors’ breweries are operating inefficiently, and future closures or reductions could be in the big brewer’s future.

The entrance to the MillerCoors plant in Eden, North Carolina, as close as you can get on Google Maps Street View.

The Top 20 Most Popular Beers Sold In America

Despite being primarily a wine site, Vinepair often has some interesting beer content. A few months ago, they created a chart of The 20 Most Popular Beers in America. The rankings are based on IRI data from 2013, which is a little odd since more recent figures are undoubtedly available. But in the top sellers, they don’t change all that often so it’s likely still reasonably accurate.
In the “Details” below, the twenty beers are listed with a number of pieces of other interesting data, including the number of cases, price per case and their Beer Advocate score.

Let’s Grab A Beer

Show of hands: who remembers “Here’s to Beer,” the somewhat lackluster attempt by Anheuser-Busch to teach consumers more about beer eight years ago? No? Let me refresh your memory. The original idea in 2005 was to have all of the major breweries work together to promote beer as an industry, rather than promote any one brand, sort of like the Beer Belongs campaign by a brewers trade group in the late 1940s and 1950s. Unfortunately, trust was not strong among the competing larger breweries and none signed on, fearing A-B would run the show and control the message for their own benefit. So A-B decided to go it alone, and launched a consumer website in 2006 called Here’s to Beer. If you click on the link, it still works, but it’s not that first attempt anymore. Before it launched there were press releases and media talking about it, including me in Here’s To Beer — Here’s to Making it Appear Relevant and Appealing. A few days later the website went live and I did an initial review of it, which was not overwhelmingly positive. A year later I started questioning if Here’s to Beer was dead with R.I.P. Here’s to Beer? But it turned out that the reports of its demise had been premature, and a month later Phase 2 launched with an updated website. That website, which used to be “” changed to “” and that’s the one that is still online, although it doesn’t appear to have been updated in quite some time, if ever. The copyright information at the bottom of the home page is dated 2009, and attributed to “Here’s to Beer, Inc.” which you won’t be surprised to learn is located at 1 Busch Place, Saint Louis,” the headquarters for Anheuser-Busch InBev. So Phase 2 was about as successful as the first attempt, and quietly faded away.

So this past Tuesday, on “National Beer Day,” you may have seen some of these graphics making the rounds on Twitter, Facebook and other social media. I know I retweeted a couple of them.

lgab-offended lgab-national-day

It turns out they’re part of a new effort by ABI, this time called “Leg’s Grab a Beer.” Apparently Beer Marketer’s Insights first reported on it, but I saw it on AdAge, in an article entitled Let’s Grab a Beer… With A-B InBev: Brewer Tries Unbranded Beer Image Campaign. The idea, this time around, according to Julia Mize, ABI VP of Beer Category + Community, is wanting “consumers to understand all the different varieties that are available with beer for different occasions.” Which is much more possible now that they acquired several more smaller breweries outright.

But her subsequent statement is really hilarious: “[W]e wanted to do it in a non-branded way so that we make sure we are connecting with the consumers and it’s not forced. It’s not marketing. Our intention here is to just have a resource that is relevant and fun and celebrates beer.” That reminds me of something Bill Hicks said about marketing, “they’re going for the anti-marketing dollar.” Essentially they’re marketing by not marketing, a tactic more prevalent in our more media-savvy present. And while I’m certainly not against a little education, this seems more like a Tumblr than any real effort at that. The plan apparently is for the “site [to] include a combination of original and aggregated content, ranging from ‘deep reads about the past, present and future of beer’ to colorful charts and graphics,” although at least for now there’s a lot more of the latter. Some of the “deep reads” include such titles as “7 Beer GIFs that Will Make Your Mouth Water” and a photograph of “Women demonstrating against Prohibition 1932.” It’s not exactly heady stuff they’re tackling so far.

Here’s to Beer, for all its faults, at least tried to educate consumers. This latest attempt seems more intended to entertain, not that there’s anything wrong with that.

The National Beer Day cards were done, apparently, in partnership with Some E-Cards. Sadly, it doesn’t look like you can make your own cards using the beer background. That’s a shame, it would have been fun to make some.

There’s definitely some interesting things being shared, but edumacation it ain’t. The other problem I see is something that seems to happen frequently to these sorts of efforts. There was a flurry of posts to the Let’s Grab a Beer Tumblr (might as well call it what it is) but then nothing new since Tuesday, three days ago. That’s a long time for a tumblr to not be updated. I have several, and make an effort to post something at least once a day, while many others post new content far more often than that. But Here’s to Beer suffered from the same problem: infrequent updates gave little reason to return to the site with any frequency. If you can absorb everything there in a few minutes and then there’s nothing new posted, why would anyone become a regular visitor?


It’s somewhat obvious why they’re doing this, as one of their own posts makes clear. So if beer drinkers are using social media more often, why wouldn’t they realize you have to keep up with the pace of that social media? If they really want something like this to work, they need at least a dedicated person working on this 24/7. That’s what makes a successful Tumblr.

Midway through the AdAge article, the author suggests it’s branding at the heart of this move.

But there is also an inherent fear in industry circles about the so-called “wineification” [how I hate that word!] of beer. This refers to placing emphasis on beer styles, versus brands. For instance, if more people walk into bars and ask for a “wheat beer,” rather than a Shock Top or Blue Moon, brands become less valuable. And good branding equals profits.

“They are facing the ultimate challenge here of trying to promote a category that really lives through its brands,” said one industry executive, speaking on the condition of anonymity. “So how do you celebrate beer without making it a commodity? The value of the industry is in the equity of the brands.”

I have to take issue with her definition of “wineification,” saying it means “placing emphasis on beer styles, versus brands.” I don’t think that’s it at all. Nobody walks into a wine bar and says “give me a Chardonnay” or “oh, anything red will be fine.” The term generally has been used to suggest that beer is trying to be fancy, or be marketed more like wine, and is usually used derisively (at least by me). I think people do look to drink a particular type of beer they’re in the mood for or for some other reason just want at a particular time, but it’s been a long time (at least a decade or more, I’d guess) since most people would sit down at a bar and ask the bartender for whatever “pale ale,” or perhaps more popularly an “IPA, they have on tap. Brands still matter a great deal, as the spate of recent high profile trademark disputes among brewers should make abundantly clear to anyone paying attention.

But the rest is an interesting insight. Branding is how all of the big brewers made their fortunes, especially when most beer tasted about the same. In effect, all beer was commodified for a long time, which is why advertising, marketing and branding became so important for the success of the big beer companies. It was no accident that year after year, A-B outspent their competition in ad dollars per barrel by a wide margin. I haven’t seen those figures since InBev took control of A-B, but certainly that was the case up until that transition.

Now that smaller breweries have essentially uncommodified beer by offering a wide range of beers that don’t all resemble or taste like one another, big brewers are left asking themselves what to do now. “So how do you celebrate beer without making it a commodity? The value of the industry is in the equity of the brands.” In some ways that, anonymous executive is still engaging in old beer thinking, using the framework of how the industry used to be constituted. One could argue it still is since 90% of beer is of that single, commodified type — American lager — but it’s nowhere near as universal as when I was a kid. And I think even small beer’s 10% slice of the total beer pie is enough to have at least changed many, if not most, people’s perception of it, even if they choose to still buy the big brewer’s beers. Even the loyal customers still buying the bland American beers know about Yuengling, or Samuel Adams, or Sierra Nevada, or New Belgium, or Lagunitas. What the big brewers bought with decades of blanket advertising was not just blind loyalty, but habit. And habits are harder to shake, because they’re no longer conscious decisions.

So I’m unequivocally in favor of beer education for everyone. We’ve known since the beginning of flavorful beer’s rise that education was the path to winning over more beer drinkers. In order to appreciate it, you have to know something about it. That may not be necessary to simply drink it and enjoy it, but to appreciate what you’re tasting, you do have to know a little more.

I think music once again provides a useful analogy. You don’t need to know anything about music theory or composition to love the Allegro con brio first movement to Beethoven’s 5th symphony in C minor, or Gershwin’s Rhapsody in Blue. But if you do, the experience is much richer because you understand what they were doing differently than their predecessors and how they were expressing musical ideas. The history of music is all about rules, and breaking them. Baroque music was very orderly and followed strict rules for its composition, then innovative composers broke those rules and created the classical music period, which in turn had its rules broken by romantic composers, and so on. Each time there was push back from the status quo before the new music became the next established form.

I think we’re seeing something similar with beer, too, as traditional rules have been broken, but are often respected, too. Innovation is simply trying something a little different or even going back to something that hasn’t been done for a long time, or mixing the two, or doing something old in a new way. It doesn’t have to mean something particularly snooty or high falootin’ as we so often seem to think. It’s just how change occurs. It’s trying to find something you can call your own that a brewery can sell and make their reputation. Few breweries, if any, will do that making the same thing as everybody else is. That’s how we got in the mess we were in by 1980 in the first place. So we should expect breweries to try something new, with 3,000 of them they almost have to experiment to find a niche, or their place in the market. Some will undoubtedly work better than others, and some will ultimately fail while others succeed. That’s the natural order of things. That’s healthy competition, with breweries competing on taste or what people are willing to support and buy.

I think I’ve veered off quite a bit from where I started with this, rambling on about some unrelated ideas, but the takeaway is that education matters — “Just Say Know™” is my catchphrase — but this may not be the best way to engage more people to learn about beer. Still, I’m up for whatever. Let’s grab a beer.

The Top 50 Annotated 2014

This is my eighth annual annotated list of the Top 50, skipping last year because the BA provided that information then, so here again you can see who moved up and down, who was new to the list and who dropped off. So here is this year’s list again annotated with how they changed compared to last year.

  1. Anheuser-Busch InBev; #1 nine years, no surprise
  2. MillerCoors; ditto for #2
  3. Pabst Brewing; ditto for #3
  4. D. G. Yuengling and Son; Same as last year
  5. Boston Beer Co.; Same as last year
  6. North American Breweries; 5th year on the list, same position as last year
  7. Sierra Nevada Brewing; Same as last year
  8. New Belgium Brewing; Same as last year
  9. Craft Brewers Alliance; Same as last year
  10. Gambrinus Company; Same as last year
  11. Lagunitas Brewing; Same as last year
  12. Bell’s Brewery; Up 1 from #13 last year
  13. Deschutes Brewery; Down 1 from #12 last year
  14. Stone Brewing; Up 3 from #17 last year
  15. Sleeman Brewing; Not in Top 50 last year
  16. Minhas Craft Brewery; Down 1 from #15 last year
  17. Brooklyn Brewery; Down 1 from #26 last year
  18. Duvel Moortgat USA (Boulevard Brewing/Ommegang); Down 4 from #14 last year
  19. Dogfish Head Craft Brewery; Up 1 from #20 last year
  20. Matt Brewing; Down 2 from #18 last year
  21. Harpoon Brewery; Down 2 from #19 last year
  22. Firestone Walker Brewing; Up 1 from #23 last year
  23. Founders Brewing; Jumped Up 12 from #35 last year
  24. SweetWater Brewing; Up 2 from #26 last year
  25. New Glarus Brewing; Same as last year
  26. Alaskan Brewing; Down 2 from #24 last year
  27. Abita Brewing; Down 5 from #22 last year
  28. Anchor Brewing; Up 1 from #29 last year
  29. Great Lakes Brewing; Down 2 from #27 last year
  30. Oskar Blues Brewing; Up 3 from #33
  31. Shipyard Brewing; Down 10 from #21 last year
  32. Stevens Point Brewery; Up 13 from #45 last year
  33. August Schell Brewing; Down 5 from #33 last year
  34. Summit Brewing; Down 2 from #32 last year
  35. Victory Brewing; Down 2 from #37 last year
  36. Long Trail Brewing; Down 5 from #31 last year
  37. Ballast Point Brewing & Spirits; Up 1 from #38 last year
  38. Rogue Ales Brewery; Down 2 from #36 last year
  39. Full Sail Brewing; Down 5 from #34 last year
  40. Odell Brewing; Up 4 from #44 last year
  41. Southern Tier Brewing; Down 1 from #40 last year
  42. Ninkasi Brewing; Down 3 from #39 last year
  43. World Brew/Winery Exchange; Down 13 from #30 last year
  44. Flying Dog Brewery; Down 1 from #43 last year
  45. Pittsburgh Brewing (fka Iron City); Down 2 from #47 last year
  46. Uinta Brewing; Not in Top 50 last year
  47. Bear Republic Brewing; Down 1 from #46 last year
  48. Left Hand Brewing; Up 2 from #50 last year
  49. 21st Amendment Brewery; Not in Top 50 last year, though they were on the list in 2012
  50. Allagash Brewing; Not in Top 50 last year

Not too much movement this year, except for a few small shufflings. Only four new breweries made the list; Sleeman Brewing, Uinta Brewing, 21st Amendment Brewery and Allagash Brewing.

Off the list was Blue Point Brewing, Cold Spring Brewing, CraftWorks Breweries & Restaurants (Gordon Biersch/Rock Bottom), Karl Strauss Breweries, Lost Coast Brewery, and Mendocino Brewing.

If you want to see the previous annotated lists for comparison, here is 2013, 2012, 2011, 2010, 2009, 2008, 2007 and 2006.

The (Big) Companies Who Actually Make Your Beer

Here’s yet another look at the changing landscape of brewery ownerships, this time from Vinepair, and while they primarily write about wine, they also must tacitly accept the well-trodden wisdom that “it takes a lot of beer to make great wine,” since they do occasionally tackle beer. Last week, the posted their “Map: The Companies Who Actually Make Your Beer.” It’s restricted to ten of the largest companies who own multiple breweries and, to their credit, it’s been updated four times so far, meaning they’re doing their best to get it right, which given its complexity, not to mention who often it’s changing, is no easy task.

Click here to see the chart full size.

Beer Giants Still Giant

The Wall Street Journal had a piece on the beer business entitled Beer Giants Cultivate Their Crafty Side which I can’t read in its entirety because I don’t have a subscription, but it did include a chart showing the current state of affairs in the beer industry.


Shifting Suds. “Independent brewers are selling more beer,” but given this comes from the Wall Street Journal (which is all about BIG business) they can’t help but add “but their shipments remain small compared with the big beer brands.”

What the Wall Street Journal forgets to mention is that Anheuser-Busch was founded in 1852 and didn’t hit 1 million annual barrels until 1901, when they were 49 years old. Sierra Nevada took only 35 years (or less) to reach 1 million, and Boston Beer needed even less time, reaching their first million barrels 1996, meaning it took Samuel Adams 12 years.

Who Owns What

As the year’s winding down, I noticed this article from Booze News from last week entitled America’s Fastest Growing Beer Brands. While the article itself offered few insights, I noticed a graphic depicting which beer companies owned which brands. The graphic was taken from a Gizmodo article that ran a little over a year ago about Who Actually Owns Your Favorite Beers. I added one or two to ABI’s stable of brands, but otherwise a year on it’s still fairly accurate. If there’s any that need to be added, or changed, let me know in the comments and I’ll see what I can do.

I think you can see the chart full size here. If not, try here instead.