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Sapporo Buys Anchor Brewing

August 3, 2017 By Jay Brooks

anchor-new sapporo-crest
This morning Anchor Brewing and Sapporo anounced that Sapporo Holdings Limited was acquiring all of the equity interest in Anchor Brewing Company, and that they’ll take over at the end of the month, August 31. As large as the beer industry is, it’s also a small community where everybody knows everybody, and everybody talks. As a result, there are few secrets. This was one of those rumors that has been circulating around the beer world for months. It’s a rumor everybody was talking about but no one could confirm, though no one was denying it either. Anchor’s press release holds back the amount of the sale, but the news release from Sapporo gives the transaction as $85 million, which seems like a bargain. Sapporo bought only the brewery; Anchor’s distillery business will be spun off into a separate company.

anchor-steam-label

Here’s Anchor’s press release:

San Francisco, CA (August 3, 2017) – Anchor Brewing Company announces that Sapporo Holdings Limited will be acquiring the company with plans to continue Anchor’s traditions and legacy in San Francisco while growing the brand globally. Anchor Brewing Company’s flagship beer, Anchor Steam® Beer, has been brewed in San Francisco since 1896. Sapporo has a long-standing history in Japan dating back to 1876 and an appreciation for tradition, craftsmanship and provenance which are all fundamental tenets of Anchor.

“Sapporo shares our values and appreciates our unique, time-honored approach to brewing,” said Keith Greggor, Anchor Brewing Co-Owner. “With both a long-term vision and the resources to realize it, Sapporo will keep brewing Anchor’s beers in San Francisco while expanding to new markets worldwide.”

“Anchor Steam Beer is a San Francisco original, inspiring a new generation of brewers and beer lovers around the world,” said Masaki Oga, President and Representative Director, Sapporo Holdings LTD. “Both companies share a brewing philosophy backed by long histories and this transaction enables both Sapporo Group’s US business and Anchor Brewing Company’s global business to make a further leap forward.”

More than 50 years ago, Anchor started the modern craft beer movement with a series of innovations. Anchor brewed the first post-prohibition Porter, ignited todays IPA boom when it introduced dry-hopping and the cascade hop and created the industry’s first seasonal beers. Since then, the emergence of thousands of craft breweries within the United States and around the world has created the need for scale and synergies to compete in a growing global market for craft beer.

Anchor’s experienced management team will continue to run the business but now benefit from superior financing and additional resources. Sapporo is committed to preserving and maintaining Anchor’s operations in San Francisco, including the historic Potrero Hill brewery. Sapporo will invest in the brewery to improve production efficiencies and will strengthen all aspects of management and production to ensure the highest quality of beer is consistently delivered. In addition, Sapporo is fully supportive of Anchor’s new public taproom concept that will be opening soon. Sapporo will also export Anchor to new international markets using its global distribution resources.

The transaction is expected to close on August 31st; subject to customary closing conditions. Terms are not disclosed. Anchor Distilling Company is not part of this transaction and will now become a fully independent company in its own right.

Sapporo first made its way to America in 1964. In 1984, SAPPORO U.S.A., INC. was founded to help preserve our high standard of quality throughout the country. Today, Sapporo stands alone as the best-selling Asian Beer in the United States for more than 30 years.

anchor-brewery-early-1900s-lg

Sapporo’s announcement on their website is more perfunctory and all-business, but in some ways more illuminating:

Sapporo Holdings Limited (hereinafter “Sapporo Holdings”) will acquire all of the equity interest of Anchor Brewing Company (California, US; hereinafter “Anchor”).

The Sapporo Group plans to further expand its US beer business by adding Anchor, a prominent beer manufacturer which produces the leading brand “Anchor Steam® Beer,” to its group.

1. Equity transfer agreement

Sapporo Holdings will enter into an equity transfer agreement with Anchor’s parent company Anchor Brewers and Distillers, LLC (hereinafter “ABD”). The transaction will be conducted through Sapporo Holdings’ subsidiary, to be established for the purpose of entering into the agreement. Sapporo will obtain all of ABD’s equity interest in Anchor which will join its group companies.

Execution date of agreement: August 3, 2017 (Thursday)

Equity transfer date: August 31, 2017 (Thursday)

2. Rationale behind Agreement

Last year, the Sapporo Group formulated the new Long-Term Management Vision “SPEED 150” through 2026, the year marking the Group’s 150th anniversary since its founding. The vision set forth in Speed 150 is for the Sapporo Group to be a company with highly unique brands in the fields of “Alcoholic Beverages,” “Food,” and “Soft Drinks” around the world.

Regarding its “Promote Global Business Expansion” policy, a key driver of its group growth strategy, Sapporo Group is pushing forward a distinctive plan that designates North America its business base and the rapidly growing “Southeast Asian” region as its highest-priority markets. In the US where the SAPPORO brand has maintained its position as the No. 1 Asian beer in the country over 30 years, the Group has been considering expanding its beer business through the acquisition of a new brand as well as further growing the SAPPORO brand.

Anchor is a prominent and historic US beer producer founded in 1896 in San Francisco. “Anchor Steam Beer,” its flagship brand, is said to be an icon that ignited the current craft beer boom in the US. Armed with its strong brand power primarily in San Francisco, where it is based, as well as other areas across the US, it has been enjoyed by countless beer lovers throughout the years.

The addition of Anchor’s strong brand power and network to the Sapporo Group’s US beer business portfolio through the conclusion of this agreement is expected to accelerate its speed of growth in the US.

3. About Anchor

Name: Anchor Brewing Company, LLC (beer manufacturing and sales)
Location: 1705 Mariposa Street, San Francisco, California, USA
Year founded: 1896
Representative: CEO Matt Davenport
Num. of employees: 160 (as of December 2016)
Production plant: One plant (San Francisco, California state)
Sales volume Approximate: 1.75 million cases (equivalent to 355ml × 24 bottles in 2016)
Annual sales Approximate: 33 million U.S. dollars (about ¥3.7 billion in fiscal 12/2016)

(Note 1) Sapporo Holdings acquired Anchor Brewing Company’s “equity” instead of its shares due to the fact that the latter is a limited liability company.

anchor-steam-label

This is, of course, big news, especially locally. The Chronicle got the exclusive on the story because Fritz Maytag had a good relationship with his local paper and after the Griffon Group bought Anchor they continued that tradition. So my newspaper group, like everyone else, was a little behind, and while their reporters are working on the story itself, they asked me to write an analysis of what the sale means for beer lovers, written for a mainstream audience, so please forgive the explanations of everyday things known by most beer aficionados. After an introduction similar to the one that began this post, here’s my initial thoughts on the acquisition of Anchor:

We know why Sapporo wanted Anchor. Their 150th anniversary is coming in 2026, and they’ve made it policy “to be a company with highly unique brands in the fields of ‘Alcoholic Beverages,’ ‘Food,’ and ‘Soft Drinks’ around the world.” They call it “Speed 150,” or the “Promote Global Business Expansion” policy. For the last thirty years, Sapporo has been the number one beer in the Asian market, but they have plans to expand worldwide through the acquisition of new brands. For example, in 2006, Sapporo bought the third-largest brewer in Canada, Sleeman Breweries.

Sapporo considered Anchor a prime target, characterizing the brewery as “a prominent and historic US beer producer founded in 1896 in San Francisco. ‘Anchor Steam Beer,’ its flagship brand, is said to be an icon that ignited the current craft beer boom in the US. Armed with its strong brand power primarily in San Francisco, where it is based, as well as other areas across the US, it has been enjoyed by countless beer lovers throughout the years.”

So what about Anchor? Why were they interested in being part of Sapporo? According to the rumors, Anchor’s been looking for funding to help fuel their growth for at least a year, as sales faltered somewhat in recent years. They’ve remained a strong brand, but the many new beers they’ve been releasing haven’t all done as well as hoped, and it’s been widely rumored that capacity has been down. Capacity is the maximum amount of beer a brewery can brew in a year, and the closer to 100% a brewery is, the more profitable they are. According to Anchor’s president, Keith Greggor, they’re currently operating at between 55 and 60 percent. The grand Pier 48 plan to build a new brewery and event space near AT&T Park has been on hold for a while now, and it’s unclear if that will change. What will change is Anchor will have access to expansion money and other resources that a company as large as Sapporo can make available for them. For example, they’ve already announced a new public taproom on De Haro St., across the street from the existing brewery will go forward as planned.

As is almost always the case, initially nothing will change at Anchor Brewing. None of the beers will change, they’ll continue to brew at their location on Potrero Hill and the current management team will remain at the helm. When Fritz Maytag sold Anchor to the Griffin Group in 2010, very little changed initially, though many hardcore beer lovers were concerned. As the beer industry is going through a period of time where breweries being bought by other breweries or financial groups is becoming commonplace, these deals are often met with a backlash. After an announced sale, many vow to no longer drink beer from the acquired brewery. It was particularly strong when Anheuser-Busch InBev bought 10 Barrel Brewing, Golden Road Brewing and several others recently or when Constellation Brands bought Ballast Point.

Most beer drinkers will be unaffected. Most don’t follow the beer industry’s news at all, and just buy the beer they like to drink. That’s what recent history has shown. There’s a small subset of all craft beer drinkers who really do follow the beer news, and care deeply about whether or not the brewery is independent. They’re often vicious on social media and once a brewery has “sold out,” they become dead to them. But in almost every case, the new markets and increased distribution that resulted from the acquisition more than makes up for losing their business and sales overall increase, often dramatically.

The trade association for craft breweries — The Brewers Association — has been promoting the value of independent breweries for many years, and rewrote their definition of a “craft brewery” in part to reflect that but also to determine who can be a member. They also recently rolled out an “Independent Craft Beer Seal” that members can put on their labels to indicate that they’re not owned by another company (or at least not more than 25 percent).

Being bought by Sapporo will make Anchor no longer eligible to be a member of the Brewers Association, which is particularly strange since Anchor Brewery is credited with starting the entire craft beer movement that resulted in the conditions that led to a trade group representing small brewers being viable. So as the days and weeks unfold, it will be interesting to see how hardcore beer lovers react. So far this morning, after the announcement, reactions have been fairly tame, at least compared to previous sales. Maybe we’re getting used to these things. They’ve definitely become part of the maturing of the craft beer industry, and we’ll continue to see many more in the coming years. This is simply part of the ups and downs of any industry.

But many beer lovers tend to be more emotional and feel an attachment to their favorite brewery, much more so than seems to happen in other businesses. Many breweries, in addition to their beer, sell a brand lifestyle that’s a part of the brand’s identity. Small brewers regularly promote themselves as being mavericks, rebels, independent or just different as a way of distinguishing themselves from the larger breweries. And it often works too well, so much so that their fans sometimes feel betrayed when they reveal themselves to have been a savvy business all along. I think with Anchor Brewery, who’s been around since 1896, they’ll be less of a backlash than in some of the more recent high profile sales. Anchor, and Fritz Maytag, re-invented itself in 1965 and sparked a revolution in beer-making. No one can take that away from them as they start the next chapter of their journey. As long as I can still get a fresh Liberty Ale the next time I stop by the brewery, everything will be fine.

anchor-liberty-label

As I’m sure many people are wondering, I asked Anchor’s press contact whether or not Fritz was consulted — not that they’d have to, of course — but just as a courtesy, and if so, what his thoughts were. As far as I can tell, I don’t think they did talk to him (again, not that they had to at all) and this was the response I got:

We think they would recognize the difficult decision we had to make and would approve of the care and diligence we have made in the route chosen. This acquisition and investment insures that Anchor will be able to continue its time-honored brewing tradition in San Francisco for a long time, which was Fritz’s goal when he sold the brewery.

Filed Under: Breweries, Editorial, News, Politics & Law Tagged With: Anchor Brewery, Announcements, Japan

Liberty IPA

January 10, 2017 By Jay Brooks

anchor-new
When Anchor’s Liberty Ale was first released in 1975, few people knew what to make of it, and in the intervening years, I’ve heard debates on both sides about whether or not it’s a pale ale an IPA or something else altogether. Certainly it was the first beer to be brewed with Cascade hops. But Anchor seems to have an answer at last to that eternal question with the announcement today that they’re releasing a new beer, Liberty IPA, based on the original Liberty Ale. The press release is below, but all you need to know is in this sentence. “Liberty IPA is Anchor’s reimagining of the craft beer classic Liberty Ale, envisioned through the lens of today’s IPAs.”

LibertyIPAFaceLabel102216Update

Today, Anchor Brewing Company announces the release of Liberty IPA™, a bold and modern twist on an original craft classic, Liberty Ale.

Like its predecessor, Liberty IPA (6.3% ABV) is made with two-row pale malt and Cascade hops. It is the combination of Cascade with new hop varieties—Nelson Sauvin and El Dorado—that creates the mouthwateringly complex and robust aromas of pine and citrus in this crisp, American-style IPA.

“Liberty IPA is a revolutionary brew—reimagined,” said Anchor Brewmaster Scott Ungermann. “The beer is a bright straw golden color and boasts aromas of dank and resinous pine up front, with bold citrus and grapefruit notes on the back end. You can really taste the assertive bitterness, with hints of a light biscuit malt base and a smooth, dry finish. Liberty IPA is a celebration of the Cascade hopped IPA’s that Anchor first popularized back in 1975 and remain at the forefront of American craft beer trends.”

Liberty IPA is Anchor’s reimagining of the craft beer classic Liberty Ale, envisioned through the lens of today’s IPAs. Liberty Ale was first brewed in 1975 to celebrate the 200th anniversary of Paul Revere’s midnight ride, and was the first American IPA brewed after prohibition. This revolutionary forerunner of the modern IPA introduced America to the Cascade hop and the nearly lost art of dry-hopping, a steeping process to infuse beer with bold hop aromas.

Taking cues from the original Liberty Ale packaging, the newly designed Liberty IPA label features the bald eagle, a symbol of strength and freedom.

Liberty IPA is available starting January 2017 nationwide for a limited time in 6-pack bottles and on draught at select bars, restaurants, and stores as well as at the Anchor Brewing Taproom in San Francisco.

LIPA-1-low-res-2

Filed Under: Beers, Breweries, News Tagged With: Anchor Brewery, Announcements, new release, Press Release

Anchor Spruce Beer

December 26, 2016 By Jay Brooks

anchor-steam
After posting a different Anchor Christmas Ale label every day for the last 42 days, I guess I’m not quite ready to let go just yet. Old-timers like me may also remember that Anchor made a Spruce Beer in 1991 to commemorate the 10th anniversary of the Great American Beer Festival.

I recall it being available on draft at GABF that year, but the remaining beer was then bottled in six-packs and sold until it was gone. I picked up several six-packs during that time, and apparently I am one of the few people to have really enjoyed the beer. It had a very fragrant nose, almost like Pine-Sol or a spruce cleanser, but it was much more muted in the flavor.

Unfortunately, Anchor rarely ever mentions it anymore. Even Fritz Maytag apparently thought it was too strong on the spruce character. There’s nothing about it on their website, and the only mention I could find was in a Modern Brewery Age article from 1991:

The Anchor Brewing Co. is presenting a draft of brewing history with a “spruce beer” that will be sold only in the city of San Francisco and in Colorado. The production of the brew will commemorate the 10th Great American Beer Festival to be held in Denver in early October.

Spruce beer is a revival of an old brewing tradition that was originated centuries ago in Northern Europe. Spruce beer was also a part of United States colonial history, as it was required by the Continental Congress to be part of every American soldier’s rations in 1775.

According to Fritz Maytag, Anchor Brewing Co.’s president and brewmaster, spruce beer is one example of many beers popular in pre-industrial Europe and America, which were brewed at home with locally available flavors and spices.

“This tradition includes everything from root beer to wassail,” Maytag noted. “Making this historic beer is a gesture of exploration and celebration. It’s an essay, an attempt to reach back into brewing history to honor the 10th anniversary of The Great American Beer Festival, and to celebrate our modern brewing Renaissance.”

Personally, I wish they’d brew it again, but I’m almost certain that will never happen. Anyway, here’s what the label looked like. It’s a shame I don’t have any to open for Unbottling Day.

Anchor-Spruce

Anchor-Spruce-neck

Anchor-Spruce-Beer-Label-and-Packagin-Design

Filed Under: Art & Beer, Beers, Just For Fun Tagged With: Anchor Brewery, Beer Labels, History

Anchor Christmas Ale 2016

December 25, 2016 By Jay Brooks

xmas-christmas-ale
It’s day forty-two, and the last one, of my Christmas canter to today featuring all 42 labels from Anchor’s Christmas Ale — a.k.a. Our Special Ale — all different beers (well, mostly different) and all different labels, each one designed by local artist Jim Stitt, up to and including this year’s label.

2016 was the forty-second year that Anchor has made their Christmas Ale, and from 1987 through the present day, each year Anchor’s Our Special Ale has included spices, a different combination of them every time. Generally the base beer has been a spiced brown ale, although it has been varied from time to time, as well. This forty-second label is a “1,000 Mile Tree,” or “Pinus Solitarius.” This is what I was drinking yesterday, and also what I’ll be drinking today, as well. I’d like especially thank Anchor Brewery historian Dave Burkhart for his kind assistance in this project and for answering my questions about the progression of the beer. Have a Malty Christmas and a Hoppy New Beer.

Anchor-Xmas-2016

Filed Under: Art & Beer, Beers, Just For Fun Tagged With: Anchor Brewery, Beer Labels, Christmas, Holidays

Anchor Christmas Ale 2015

December 24, 2016 By Jay Brooks

xmas-christmas-ale
It’s day forty-one of my jolly jog to Christmas featuring all 42 labels from Anchor’s Christmas Ale — a.k.a. Our Special Ale — all different beers (well, mostly different) and all different labels, each one designed by local artist Jim Stitt, up to and including this year’s label.

2015 was the forty-first year that Anchor made their Christmas Ale, and from 1987 through the present day, each year Anchor’s Our Special Ale has included spices, a different combination of them every time. Generally the base beer has been a spiced brown ale, although it has been varied from time to time, as well. This forty-first label was was a “California Christmas Tree,” or “Cedrus Deodara.”

Anchor-Xmas-2015

Filed Under: Art & Beer, Beers, Just For Fun Tagged With: Anchor Brewery, Beer Labels, Christmas, History, Holidays

Anchor Christmas Ale 2014

December 23, 2016 By Jay Brooks

xmas-christmas-ale
It’s day forty of my fast festive flurry to Christmas featuring all 42 labels from Anchor’s Christmas Ale — a.k.a. Our Special Ale — all different beers (well, mostly different) and all different labels, each one designed by local artist Jim Stitt, up to and including this year’s label.

2014 was the fortieth year that Anchor made their Christmas Ale, and from 1987 through the present day, each year Anchor’s Our Special Ale has included spices, a different combination of them every time. Generally the base beer has been a spiced brown ale, although it has been varied from time to time, as well. This fortieth label was was a “Giant Sequoia,” or “Sequoiadendron giganteum.”

Anchor-Xmas-2014

Filed Under: Art & Beer, Beers, Just For Fun Tagged With: Anchor Brewery, Beer Labels, Christmas, History, Holidays

Anchor Christmas Ale 2013

December 22, 2016 By Jay Brooks

xmas-christmas-ale
It’s day thirty-nine of my Rudolph’s run to Christmas featuring all 42 labels from Anchor’s Christmas Ale — a.k.a. Our Special Ale — all different beers (well, mostly different) and all different labels, each one designed by local artist Jim Stitt, up to and including this year’s label.

2013 was the thirty-ninth year that Anchor made their Christmas Ale, and from 1987 through the present day, each year Anchor’s Our Special Ale has included spices, a different combination of them every time. Generally the base beer has been a spiced brown ale, although it has been varied from time to time, as well. This thirty-ninth label was was a “California White Fir,” or “Abies concolor var. Lowiana.”

Anchor-Xmas-2013

Filed Under: Art & Beer, Beers, Just For Fun Tagged With: Anchor Brewery, Beer Labels, Christmas, History, Holidays

Anchor Christmas Ale 2012

December 21, 2016 By Jay Brooks

xmas-christmas-ale
It’s day thirty-eight of my holiday hotfoot to Christmas featuring all 42 labels from Anchor’s Christmas Ale — a.k.a. Our Special Ale — all different beers (well, mostly different) and all different labels, each one designed by local artist Jim Stitt, up to and including this year’s label.

2012 was the thirty-eighth year that Anchor made their Christmas Ale, and from 1987 through the present day, each year Anchor’s Our Special Ale has included spices, a different combination of them every time. Generally the base beer has been a spiced brown ale, although it has been varied from time to time, as well. This thirty-eighth label was was a “Norfolk Island Pine,” or “Araucaria heterophylla.”

Anchor-Xmas-2012

Filed Under: Art & Beer, Beers, Just For Fun Tagged With: Anchor Brewery, Beer Labels, Christmas, History, Holidays

Anchor Christmas Ale 2011

December 20, 2016 By Jay Brooks

xmas-christmas-ale
It’s day thirty-seven of my seasonal scurry to Christmas featuring all 42 labels from Anchor’s Christmas Ale — a.k.a. Our Special Ale — all different beers (well, mostly different) and all different labels, each one designed by local artist Jim Stitt, up to and including this year’s label.

2011 was the thirty-seventh year that Anchor made their Christmas Ale, and from 1987 through the present day, each year Anchor’s Our Special Ale has included spices, a different combination of them every time. Generally the base beer has been a spiced brown ale, although it has been varied from time to time, as well. This thirty-seventh label was was a “Great Basin Bristlecone Pine,” or “Pinus longaeva.”

Anchor-Xmas-2011

Filed Under: Art & Beer, Beers, Just For Fun Tagged With: Anchor Brewery, Beer Labels, Christmas, History, Holidays

Anchor Christmas Ale 2010

December 19, 2016 By Jay Brooks

xmas-christmas-ale
It’s day thirty-six of my seasonal scoot to Christmas featuring all 42 labels from Anchor’s Christmas Ale — a.k.a. Our Special Ale — all different beers (well, mostly different) and all different labels, each one designed by local artist Jim Stitt, up to and including this year’s label.

2010 was the thirty-sixth year that Anchor made their Christmas Ale, and from 1987 through the present day, each year Anchor’s Our Special Ale has included spices, a different combination of them every time. Generally the base beer has been a spiced brown ale, although it has been varied from time to time, as well. This thirty-sixth label was was a “Maidenhair Tree,” or “Ginkgo biloba.”

Anchor-Xmas-2010

Filed Under: Art & Beer, Beers, Just For Fun Tagged With: Anchor Brewery, Beer Labels, Christmas, History, Holidays

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