Brookston Beer Bulletin

Jay R. Brooks on Beer

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CAMRA Unhappy About Greene King Takeover

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On Friday, the UK’s Guardian Unlimited that CAMRA and other consumer advocacy groups are already angered by Greene King’s takeover big to buy Hardys & Hansons, after which they believe “Hardys & Hansons will be chewed up and spat out like so many before it,” according to Camra’s chief executive, Mike Benner. Hardys & Hansons also includes the pub Ye Olde Trip to Jerusalem in Nottingham, believed to be the oldest pub in Great Britain. The pub is literally carved into the sandstone under Nottingham castle, although Wikipedia indicates that perhaps nineteen other pubs have similar claims to the title “oldest in Britain.” Greene King’s bid has thus far included no information about the fate of the pub, the brewery or their employees.


 
 

From CAMRA’s press release:

The Campaign for Real Ale today called on shareholders of Hardys & Hansons to reject the takeover offer from Greene King and draw a line in the sand on behalf of beer consumers.

The offer to buy Nottingham based Hardys & Hansons is the latest in a series of acquisitions that has seen Greene King devour ten rivals in ten years.

CAMRA Chief Executive Mike Benner said: “If this deal goes through, history has shown us that Hardys & Hansons’ brewery and beers will not be in safe hands. Now is the time for the shareholders who truly care about this excellent brewery with more than 174 years of history to make a stand and reject this offer.

“Today’s announcement made scant reference to the future of the beers, the brewery or the staff. We believe if the shareholders don’t block this now, Hardys & Hansons will be chewed up and spat out like so many before it.”

CAMRA is concerned that the acquisition of Hardys & Hansons 268 strong pub estate would take the number of pubs owned by Greene King and selling its beers to around 2680 nationwide. Having such a massive presence can only be damaging to consumer choice.

Mike Benner continued: “In 2002 CAMRA warned the Government that the abolition of the Guest Beer Right would result in a series of mergers and takeovers that would undermine competition and consumer choice. Do we want to find ourselves in a situation where every other pub sells only Greene King IPA? The Guest Beer Right must be reintroduced before it is too late so that licensees can sell a beer of their choice to preserve the future for independent breweries.”

Here’s a history of buyouts undertaken by Greene King over the last ten years:

  1. 1996: Magic Pub Company (This pub group included the Hungry Horse concept which is now one of the Greene King’s pub brands)
  2. 1999: Morlands Brewery (closed the brewery and Ruddles beer brands acquired at the same time)
  3. 2001: Old English Inns (the pub estate integrated into the GK pub estate)
  4. 2002: Acquired the Morrells Pub company (pubs integrated with the GK pub estate)
  5. 2004: Laurel Pub Company (pubs integrated with the GK pub estate)
  6. 2005: Ridleys Brewery (brewery closed)
  7. 2005: Belhaven Brewery (brewery still open)

Interview with Kona’s Rich Tucciarone

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Today’s Honolulu Star Bulletin has a nice profile and interview with Rich Tucciarone, Director of Brewery Operations for Kona Brewing. Rich is a great guy and it’s nice to see him — and the brewery — getting some much-deserved ink in the mainstream press.

Rich Tucciarone (at right) with fellow Kona brewer Britt Antrim (at left) at last year’s GABF.

Guinness Devolution

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Yesterday the other Cannes film festival began, the 53rd annual International Advertising Festival, a.k.a. Cannes Lions. A total of 24,862 commercials were entered in this year’s festival. According to Advertising Age’s Bob Garfield, the best of the almost 25,000 ads was one by Guinness known as NoitulovE. Happily, AdAge has the commercial posted on their site so you can watch NoitulovE. Just press play part way down Garfield’s article.

Here’s Bob Garfield’s description of the ad:

In the end, the best commercial of the year is simply much better — much better than Sony and even much better than the four-star “Big Ad.” It’s from Abbott Mead Vickers BBDO, London, for Guinness, and it is in every way a masterpiece.

Three young blokes sit at a bar sipping pints of creamy Guinness. Then the film starts going in reverse — out of the pub, onto the street, into prehistory, dinosaur life and all the way back to primordial slime. All this to Sammy Davis Jr.’s swinging rendition of “Rhythm of Life.”

“The Rhythm of Life is a powerful beat, puts a tingle in your fingers and a tingle in your feet. Rhythm in your bedroom, rhythm in the street. Yes, The Rhythm of Life is a powerful beat. …”

And so on. Eventually, the three guys are devolved all the way back to prehistoric mudskippers, just crawling out of the seas, and the familiar tagline: “Good things come to those who wait.” They sure do. Be patient long enough and you’ll find a flawless DGI production to an irresistible piece of music propelling a brilliant, astonishingly witty new iteration of a longstanding, unique positioning. This isn’t just great advertising; it is perfect advertising.

Click on the picture above to watch the commercial. It’s also available from Guinness and ‘boards.

Foster’s Retreats from China

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Foster’s has sold its last remaining Chinese brewery, in Shanghai, to the Japanese Suntory for an estimated $15 million. Like Lion Nathan a few years earlier, also abandoned the Chinese market, which is the second larget beer market in the world.

According to the Sydney Morning Herald:

ABN Amro analyst David Cooke said Foster’s and Lion Nathan’s exit from China was largely a result of the two being out-muscled – and out-capitalised – in the race for Chinese beer drinkers by brewers such as Anheuser-Busch, SABMiller and Heineken.

“Foster’s and Lion Nathan didn’t have the deep pockets that the other players had,” Mr Cooke said.

The Shanghai sale came seven years after Foster’s signalled its first retreat from China with the sale of its Tianjin and Guangzhou brewing businesses. The sale also comes one month after Foster’s announced the sale of the Foster’s brand in Europe to Scottish & Newcastle for $750 million.

Foster’s said it would continue to market its flagship beer brands in China, pointing out that 90 per cent of the beer shipped from its Shanghai brewery were local Chinese brands. However, there is speculation Foster’s may even sell the licensing rights for its brands in Asia. The company ranks its flagship brand as the seventh highest selling “premium brand” in the world, with 100 slabs being consumed in 150 countries annually.

Additional information from the Foster’s Group press release:

Foster’s Group in China

Foster’s Group entered the Chinese market in 1993, acquiring majority stakes in the Shanghai, Guangdong and Tianjin breweries, Foster’s Group sold the Guangdong and Tianjin breweries in 1999.

The Foster’s Shanghai brewery was originally built in 1935 and has undergone two significant capacity and technology upgrades, the first in 1987 and the second in 1997. With production capacity of 1 million hectolitres, the brewery produces the Shanghai Lager, Guangming, Qing Yi, Yi Hao and has been brewing the Foster’s Lager brand since 1997.

The Foster’s Brand

First brewed in 1888 by the Foster brothers in Melbourne, Australia, Foster’s Lager is one of the world’s best beers. As one of only a handful of truly global beer brands, Foster’s in now available in over 150 countries. Foster’s is one of the fastest growing international premium beer brands in the world and has enjoyed international growth of 40% since 1997. Foster’s is brewed in 12 countries, at 17 locations with over 100 million cases of Foster’s sold annually.

Suntory in China

In 1984, Suntory established China Jiangsu Suntory Foods Co., Ltd. in Lianyungang, Jiangsu Province, as the first foreign company to become a joint venture brewer in China. The company entered the fast growing beer market in Shanghai in 1995 and achieved the number one position in Shanghai in 1999. Suntory Shanghai has maintained a steady growth and produced and sold the first draft beer in the region. In 2005, Suntory acquired the Shanghai Donghai Brewery, and now holds a 54% market share in Shanghai

Top Ten Brewpubs

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The Brewers Association has released their list of the ten biggest brewpubs in the country.

  1. Oskar Blues Grill & Brewery; Lyons, CO
  2. Boundary Bay Brewery & Bistro; Bellingham, WA
  3. Sudwerk Privatbrauereii Hubsch; Davis, CA
  4. Elysian Brewing; Seattle, WA
  5. Eel River Brewing; Fortuna, CA
  6. Hofbrauhaus Newport; Newport, KY
  7. Wynkoop Brewing; Denver, CO
  8. BJ’s Brewery – Brea; Brea, CA
  9. Monte Carlo Pub & Brewery; Las Vegas, NV
  10. Great Dane Pub & Brewery; Madison, WI

It’s Good to Be the King: Greene King Takeover Bid for Hardys & Hansons

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Greene King, the pub and Brewery conglomerate, has made a takeover bid of just under a half million dollars for Hardys and Hansons. It looks like it’s all but a done deal, as Hardys family shareholders control about 50% of the voting stock and support the deal. Hardys and Hansons owns 268 pubs which will bring the Greene Total to over 2,400 pubs.

Greene King also owns Abbot Ales, Belhaven, Old Speckled Hen and Ruddles. According to the BBC, “Greene King will continue to brew Hardys beers although the future of the brewery has not been disclosed.”

Latrobe Rumor Mill

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On Tuesday I heard that the buyer for the Latrobe Brewery was rumored to be D.G. Yuengling & Son of Pottsville, Pennsylvania. Recent news reports from local Pittsburgh media discuss that possibility plus address other potential buyers.

Sierra Nevada Brewing:

Steve Harrison, vice president of the Chico, California, brewer, said his company was not interested in the plant.

Ken Grossman, president of Sierra Nevada Brewing, said yesterday his firm was initially contacted by InBev after the sale.

“We had some casual interest when it first came on the market, but the facility is way too large for us to consider,” Grossman said, “and without a brand, well, it just doesn’t fit into our plans.”

Sierra Nevada produces 600,000 barrels a year of its own beer and does not do contract brewing for other beer companies. Latrobe Brewing produces 825,000 barrels annually but has capacity for 1.3 million.

Boston Beer Company:

Boston Beer Co. had conversations with Pennsylvania Governor Ed Rendell and because of opposition to its plans to build a brewery in Freetown, Massachusetts were considered a good candidate. “However, voters in Freetown on Monday approved a lucrative tax-increment financing proposal, an agreement that will give Boston Beer tax breaks averaging 33 percent for 20 years, said John S. Ashley, chairman of the Board of Selectmen in Freetown.”

“In addition to building a plant, Boston Beer Co. purchased a brewer in Cincinnati, Ohio, last year and spent $11 million on improvements. The company sold more than 1.3 million barrels of beer last year, according to its annual report.”

Boston Beer Company is “too far down the line” with plans to construct the new brewery in Massachusetts to be a serious contender for Latrobe.

D.G. Yuengling & Son:

The “chief operating officer for D.G. Yuengling & Son of Pottsville, Schuylkill County, said yesterday it already operates three breweries and is not actively seeking to add beer-making capacity.”

“It’s not us who is moving close to a deal. We already have a lot on our plate. But we never say never,” said David A. Casinelli, who pointed out the company operates two breweries in Pottsville and bought a former Stroh’s plant in Tampa, Florida, in 1999.

Further, “the governor said Yuengling did not express interest in the plant, to his knowledge.”

This had been the strongest contender in my mind because I’d heard their name from a friend who’d heard it from an industry insider. So either these news sources are smoke and mirrors or in fact Yuengling is not the potential buyer.

Pittsburgh Brewing Company:

Pittsburgh Brewing was an early name mentioned in reports but being in a Chapter 11 bankruptcy made that possibility more remote. They have not been seriously mentioned as a potential buyer for a couple of weeks now.

Conclusions:

Governor Rendell said there has been interest in purchasing the Latrobe Brewing plant from two brewers and four or five investor groups, but the investors were unable to come up with financing. As to who they are and who ultimately buys the Latrobe Brewery, if anyone, will still have to wait for an official pronouncement. Until then, it’s anybody’s guess.

Talking Beer Cans

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Miller Brewing’s summer promotion will be called Open Up: The Great Taste of Summer and apparently specially marked packages of Miller’s two most popular beers, Miller Lite and Miller Genuine Draft, will include a talking beer can! The talking can will tell you if you’ve won one of several music or sports-related prizes. Frankly, that seems a little scary to me. I love Tony Magee’s expression “Beer Speaks, People Mumble” but I’ve never taken it literally. If someone told you their beer can talked to them, would you believe them? Or would you think they’d had one too many?