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View Full Version : A-B looking to buy 35% of Boulevard?


shaneo69
05-23-2006, 01:43 PM
A-B wants a taste of microbrews
By Gregory Cancelada
POST-DISPATCH
05/22/2006

Anheuser-Busch is eying potential distribution agreements and investments with U.S. microbreweries as a way to broaden its portfolio of beers.

Though Anheuser-Busch reportedly is close to acquiring a minority stake in Chicago microbrewery Goose Island Beer Co., industry observers say such a deal may only be the first of other ventures between A-B and microbreweries.

Though craft brewing, which includes microbreweries, represents only 3.5 percent of the U.S. beer market, strong growth and higher prices make craft beer attractive.

The country's three major brewers saw shipments decline last year, but beer production by microbreweries and brewpubs reached 7 million barrels last year, up 9 percent from 2004. Each barrel is equal to 31 gallons of beer.

Earlier this year, Anheuser-Busch approached Kansas City-based brewery Boulevard Brewing Co. about a possible partnership. Touting itself as Missouri's second-largest brewer, Boulevard produced about 104,000 barrels last year, up 16 percent from 2004.

The meeting, held in Kansas City, was cordial but it did not involve a specific proposal, said Boulevard Vice President and Chief Marketing Officer Bob Sullivan.

A-B has a strong wholesaler system, but Boulevard is pleased with its existing distribution arrangements, Sullivan said.

"We didn't feel the need to take the conversation to the next level," he said. "It just didn't fit into our plans."

Though his own brewery has not been contacted, there has been plenty of talk about A-B in the craft brewing industry, said Dan Kopman, president and chief operating officer at St. Louis Brewery Inc., the maker of Schlafly beer.

Getting A-B's financial strength and distribution muscle are obvious benefits to a partnership.

A partnership also would allow a microbrewery to buy materials at the same price Anheuser-Busch pays, Kopman said.

"That is a huge benefit," he said.

Still, some microbreweries would flinch at the idea of making A-B a partner, even if they kept a controlling stake in the business.

"It's like David selling out to Goliath," Kopman said.

A brewer like Boulevard does not mean much for a company the size of Anheuser-Busch, which shipped 101 million barrels last year in the United States.

But A-B has been dramatically expanding the breadth of its portfolio of beers, an acknowledgment that consumers want more choices.

This summer, Anheuser-Busch breweries in Columbus, Ohio, and Merrimack, N.H., will start making a specialty draft beer for Ohio and New England. On Friday, A-B announced it had acquired the Rolling Rock beer brands.

A-B's interest in microbreweries isn't new. When craft brewing heated up during the 1990s, Anheuser-Busch purchased stakes in two Pacific Northwest breweries: Seattle-based Redhook Ale Brewery Inc. in 1994 and Portland-based Widmer Brothers Brewing Co. three years later.

The St. Louis brewer now has a 34 percent stake in Redhook and owns 39.5 percent of Widmer.

Goose Island appears to be next. Citing anonymous sources, the Chicago Tribune reported last week that Anheuser-Busch was close to buying up to 35 percent of Goose Island in a deal where A-B wholesalers would distribute that beer. A-B and Goose Island declined to comment.

Goose Island brewed about 54,000 barrels last year, a 12 percent increase from 2004 but down from 2003's output of 56,000, according to trade publication Beer Marketer's Insights. That is about a quarter of Redhook's volume last year.

Kopman suspects Anheuser-Busch is interested more in Goose Island's popularity in the Windy City rather than its potential to become a national brand.

"Personally, I think this is a Chicago play," he said.

Chicago is an extremely competitive beer market given the popularity of Miller Brewing Co., a unit of London-based SABMiller. A broader portfolio could help A-B wholesalers get access to more retail accounts.

Because of intense competition, a partnership could help Goose Island, Kopman said.

"Chicago is brutal," he said. "In that market, they need a strong partner."

Phobia
05-23-2006, 01:49 PM
Ruined my entire week.

Dartgod
05-23-2006, 01:50 PM
Please, God, no. DO NOT let this happen.

StcChief
05-23-2006, 01:53 PM
Just SAY NO. to A-B. if you can't make 'em buy 'em.
Glad BLVD is sitting tight....

my taste for Widmer Wheat Ale (Hefeweisen) is now waining...

Never really cared for Redhook....

The Goose Island Ale is pretty good.

noa
05-23-2006, 01:54 PM
This sucks. Screw Anheiser-Busch. Not only did they steal the original Budvar from the Czech Republic, water it down, and call it Budweiser, but they sued Budvar from using their own name so in America, it can only be purchased as Czechvar. Leave the little guys alone and keep peddling your piss water to the masses. My favorite Monty Python quote is "American beer is like having sex in a canoe. Its F**king close to water."

Donger
05-23-2006, 01:55 PM
I had some Boulevard Pale Ale when I was in KC last week. Unfortunately, it wasn't as good as I remembered it to be.

sedated
05-23-2006, 01:55 PM
NOOOOOOOOOOOO!


say it ain't so

Cochise
05-23-2006, 02:00 PM
I had some Boulevard Pale Ale when I was in KC last week. Unfortunately, it wasn't as good as I remembered it to be.

I don't think so either. Wheat is good though.

Spicy McHaggis
05-23-2006, 02:03 PM
AB you keep your dirty stinking hands off our good beer. Props to Boule for telling them to shove off for the time being.

I am sad to hear Goose Island is seriously considering going the A-B route though. Good Chicago beer.

jspchief
05-23-2006, 02:07 PM
Could you make the thread title any more sensationlistic and misleading?

The 35% number is attributed to Goose Island, not Boulevard. And Boulevard basically looks like they are saying no to any offer at this point.

chagrin
05-23-2006, 02:17 PM
My favorite Monty Python quote is "American beer is like having sex in a canoe. Its F**king close to water."

Isn't it, "What does Making love in a canoe and American beer have in common, they're both ****ing close to water"

??

noa
05-23-2006, 02:23 PM
Isn't it, "What does Making love in a canoe and American beer have in common, they're both ****ing close to water"

??


Yeah, you're definitely right. Sorry about that. I got excited and messed up the quote. Eric Idol tells it when he's playing an Australian.

shaneo69
05-23-2006, 03:37 PM
Could you make the thread title any more sensationlistic and misleading?

The 35% number is attributed to Goose Island, not Boulevard. And Boulevard basically looks like they are saying no to any offer at this point.

I left the title of the article intact at the beginning of the article. Nothing misleading there.

The thread title is simply asking a question that seems like a fair guess at A-B's motives, considering they got together with the owners of Boulevard to "talk", and industry insiders are saying that the A-B / Goose Island collaboration may only be the first of A-B's ventures with microbreweries, and the fact that A-B bought 34% of Redhook, 39.5% of Widmer, and now 35% of Goose Island.

Did I really make that big of a leap in wondering if A-B is looking to buy 35% of Boulevard?

Sounds like somebody must be a little "grumpy" about all the votes he's getting on another thread.

Dr. Facebook Fever
05-23-2006, 03:40 PM
A-B can suck my sweaty balls... then spit it into a can call it beer. It'd taste no worse than the swill they call beer now.

Skip Towne
05-23-2006, 03:47 PM
Ah yes..........beer snobs.