16 Nov Who Owns Who in Beer and How it Doesn’t Help Us Understand Pabst’s Suit Against Miller Coors
by Mark E. Lasbury for Indiana On Tap
I have no problem admitting that I need help every once in a while. Walter reminds me it often enough that I have gotten quite used to asking for directions and dealing with that “some assembly required” stuff. In truth, the world has taken a turn for the worse; the one thing men really had going for them was their ability to fold maps – but who uses maps anymore?
In terms of beer, one of the things for which I need a crutch is remembering who owns who. Most breweries are single entities, they live and function on their own. Others may have investors, but they don’t have owners. Your hometown brewery is probably not beholden to another business or being told how to manage their affairs by some larger brewery that holds them as a small subsidiary.
Some breweries are grouped together under common ownership. In certain cases, they still act as individual breweries, but they gain from having more capital to pass around and additional power in buying consumables and distribution area. If the owners or partners are also breweries and they make less than six million barrels of beer annually, the Brewers Association can still consider them “craft” brewers.
An example of this would be Duvel, a family owned brewery that also owns Boulevard Brewing in Kansas City, Brewery Ommegang in Cooperstown, NY, and Firestone Walker in California. Other ownership groups aren’t so easy to list or keep track of. That’s why a newly updated infographic poster from The Mad Fermentationist is so helpful. Located here, this is a purchasable graphic poster that breaks down exactly who owns who by brewery or owner logo – now you don’t have to try and remember it all.
You can purchase a poster of this graphic at The Mad Fermentationist. image credit: The Mad Fermentationist
Those ten US faux-craft breweries own by AB-InBev? They are shown here. How much of Founders is owned by Mahou San Miguel? It’s listed here. Did you know that Kirin owns Brooklyn Brewing, but is in turn owned by Mitsubishi? This is a thorough and up-to-date display of information. It even shows the recent partnering of Sixpoint Brewery from Brooklyn, NY with Artisanal Brewing Ventures (see this article). Victory Brewing of Lancaster, PA and Southern Tier from Lakewood, NY were already held under this umbrella, and now they’re joined by the maker of beers like Puff, Resin, and Bengali.
One of the helpful parts of this graphic is showing most of the companies that market themselves as independent, but are really part of mega-beer corporations. Also, it shows the split of Molson-Coors and Miller-Coors once AB InBev acquired SAB Miller. It even gets detailed enough to indicate that AB InBev owns Labatt, but the USA portion of the company is ultimately by Florida Ice & Farm, the same company that owns Magic Hat and others.
Of course, the infographic can’t be complete; there are just too many brands held by some of these massive corporations. For AB InBev, there is a small +82 showing that there are a whole bunch of brands that couldn’t be shown. Likewise, Molson Coors has 31 un-shown brands, Carlsberg has 23 additional brands, and Heineken has a whopping 144 brands that aren’t shown. However, most of these brands are made and sold outside the US, so the graphic works here just fine. Also not shown are the private equity firms that have stakes in some breweries, like those that own parts of The Bruery or Stone Brewing.
The Mad Fermentationist’s infographic is indeed a fine piece of work that acts as a fine memory crutch for me in terms of understanding and talking about the relationships in beer. As such, I moved to consult it this week when I heard about the lawsuit filed by Pabst against Miller Coors. I wondered what Miller Coors had done now, but the articles I read (here and here) surprised me a bit when it explained the basis of the suit.
It seems that Miller Coors has produced and canned the majority Pabst’s brands of beer for the past 17 years. Yet the infographic shows no relationship between Pabst and Miller Coors. That’s because Pabst paid Miller for the service, and Miller received access to some of PBR’s demographic; it was strictly a business deal. That agreement expires in 2020, and no new deal has yet to be struck. In fact, Pabst states in a series of suits that Miller Coors is actively trying to put Pabst out of business.
It’s possible that after the lawsuit is ended, the red line might be over the PBR label, and connect to a red circle. image credit: Pabst Brewing
The back and forth has begun, as one of the lawsuits has gone to trial this month. Pabst claims that Miller Coors has been negotiating in bad faith, suggesting that Pabst pay triple the fee in the next contract, something that Pabst says will instantly put them out of business. Pabst says that Miller Coors has gone so far as to try and close two breweries in order to claim that they no longer have the capacity to keep making the Pabst products.
Miller Coors says that the money Pabst is paying them isn’t enough to warrant continuing to produce and package the 4.5 million barrels of Pabst beers each year. No matter what Miller Coors decides is the main reason they can’t continue the deal – capacity or money, Pabst contends that they are completely dependent on Miller, and that a lack of continuation of the deal will put them out of business.
Indeed, there is a clause in the original agreement that allows for two five-year extensions. The problem is that each company says that it is up to them to decide if those clauses will be acted upon. As part of one of their suits, Pabst has accused Miller of breach of contract, and is seeking $400 million in damages in addition to forcing Miller to keep making Pabst beers.
As craft beer fans, one of the interesting things about this is that we don’t really have a dog in the fight, although plenty of brewers do enjoy a PBR or Miller High Life on occasion. Since most of us are on the outside looking in, it’s much like passing an accident as you travel down the road, we just can’t help slowing down to see what kind of damage has been done. Depending on how these suits play out, The Mad Fermentationist might need to rearrange the infographic poster again to reflect either a loss of brands or a movement of ownership. I’ll be first in line for any new version of that poster – I’ll always be needing the help.
banner image credit: Benaters
No Comments