# EARTHQUAKE: ABI buys Northern Brewer,Midwest Supply



## jswordy (Oct 17, 2016)

Rumors swirled last week, just confirmed: 

ABI has acquired Northern Brewer and Midwest Supply, the two mega-heavyweights in the homebrewing and winemaking supply business nationally. 

http://www.homebrewtalk.com/anheuser-busch-inbev-acquires-northern-brewer-midwest-supplies.html


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## jswordy (Oct 17, 2016)

http://www.startribune.com/rosevill...ht-by-world-s-largest-beer-company/397142501/

http://www.twincities.com/2016/10/14/northern-brewer-sold-to-anheuser-busch-inbev/


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## Boatboy24 (Oct 17, 2016)

Ha! Loved this comment:

_Maybe they’ll offer a sweet Bud Light clone kit! Just what every home brewer has always wanted._


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## jswordy (Oct 17, 2016)

I dunno, man. The NB folks say nothing will change at NB or Midwest Supply. But you look at the ZX Ventures site and read it, aaaand ... I think things are gonna change, and if you're a competitor, the change won't be good...

http://zx-ventures.com/

People may gripe now but they will buy from them.


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## Mismost (Oct 17, 2016)

If you're gonna get bought out, this seems like a good fit. I've always been satisfied with Northern and Midwest. If the pricing and service levels are there, I will be too. I see some synergy here...the power of bulk buying, the brewing expertise, very similar businesses....better than if they were bought out by someone like PayLess Shoes!

Maybe we can get our hands on some of that famous Beech Wood for aging our beers....who knows!


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## Bartman (Oct 18, 2016)

I'm curious for the prospects of my LHBS - Fine Vine Wines. I'll have to check with the owner to see if he thinks this is a good thing or a bad thing for his business.


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## dcbrown73 (Oct 18, 2016)

jswordy said:


> I dunno, man. The NB folks say nothing will change at NB or Midwest Supply. But you look at the ZX Ventures site and read it, aaaand ... I think things are gonna change, and if you're a competitor, the change won't be good...
> 
> http://zx-ventures.com/
> 
> People may gripe now but they will buy from them.



Acquiring companies always say that before they pull the rug out. hah.


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## Whitehrs (Oct 18, 2016)

jswordy said:


> Rumors swirled last week, just confirmed:
> 
> ABI has acquired Northern Brewer and Midwest Supply, the two mega-heavyweights in the homebrewing and winemaking supply business nationally.
> 
> http://www.homebrewtalk.com/anheuser-busch-inbev-acquires-northern-brewer-midwest-supplies.html




My favorite argument is that (paraphrase) "they changed Becks, and now it tastes like crap." (end paraphrase). Becks has always been nothing but pilsner headache beer. it has always tasted like crap.. So, how have they changed it.


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## fenderbass (Oct 18, 2016)

I remember reading the history on AB, and I think I remember reading that the company shifted to producing malt extract through Prohibition. Essentially, they became a homebrew supply given that they had the existing supply chain. If I remember correctly, they pre-Prohibition world of the beer world changed radically so that AB could no longer own any bars (or have close affiliation with them). I'm not a big fan of AB and their tactics, but I just found it interesting that they are returning to their Prohibition activities.


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## Redbird1 (Oct 18, 2016)

I haven't bought from Northern Brewer / Midwest ever since they released the dangerously thin Big Mouth Bubbler and refused to accept responsibility and denied there was any issue. They were extremely negligent in continuing to sell them even after many reports of them being dangerous. There is a thread on Homebrewtalk about all of the injuries resulting from failed BMB under normal usage. People got seriously hurt and one poster even has permanent damage to his thumb.

I've happily paid more since then to buy elsewhere. I'm not supporting a company with such poor ethical standards.

Edit: They must have changed their practice of filtering negative reviews. I haven't shopped there in a long time, so I'm glad to see that has changed.


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## jswordy (Oct 18, 2016)

Whitehrs said:


> My favorite argument is that (paraphrase) "they changed Becks, and now it tastes like crap." (end paraphrase). Becks has always been nothing but pilsner headache beer. it has always tasted like crap.. So, how have they changed it.



Everybody has their own ABI acquisition sob story. Mine is Rolling Rock. Now an ABI price-line beer, it is a mere shadow of what it once was as a premium label. And - no matter what anyone else thinks of the brand - I miss it.


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## jswordy (Oct 18, 2016)

dcbrown73 said:


> Acquiring companies always say that before they pull the rug out. hah.



I have personal career experience with what happens internally when owns trot the word "disruptive" out and start throwing it casually around. It is not good.

I think this will be categorically disruptive, too, meaning it will eventually pressure everyone from national competitors to local sources.


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## jswordy (Oct 18, 2016)

A few more details...

https://www.brewbound.com/news/anhe...oup-purchases-popular-homebrew-supply-company


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## ceeaton (Oct 18, 2016)

jswordy said:


> Everybody has their own ABI acquisition sob story. Mine is Rolling Rock. Now an ABI price-line beer, it is a mere shadow of what it once was as a premium label. And - no matter what anyone else thinks of the brand - I miss it.



I thought I was the only one who noticed RR's quality issues. Just isn't the same, haven't bought a case in quite some time. Was sort of a cult beer up in our area, I'm too out of touch as a parent of four kids to know where it stands now. Just don't hang out in bars any more (no money, no time, happier at home).


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## BernardSmith (Oct 18, 2016)

I am scratching my head trying to make sense of this acquisition.


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## Whitehrs (Oct 18, 2016)

I know this isn't going to make me any friends here, but I'll just be glad if they drop the prices on gear, and recipe kits..


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## jswordy (Oct 19, 2016)

ceeaton said:


> I thought I was the only one who noticed RR's quality issues. Just isn't the same, haven't bought a case in quite some time. Was sort of a cult beer up in our area, I'm too out of touch as a parent of four kids to know where it stands now. Just don't hang out in bars any more (no money, no time, happier at home).



You don't go from $7 a six-pack to $8.99 a 12-pack and not make some sacrifices. It still has a wee bit of the distinctive flavor, probably from the yeast profiles, but not at all like it was in the 1990s. I can tip up a RR now and just let it go right down similar to Bud Light. Could not do that in the '90s, and didn't want to because of the flavor.

I wish I had some of that original yeast.

This says it all, and this disclaimer was not on the pre-buy bottles:

"To honor the tradition of this great brand..."


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## jswordy (Oct 19, 2016)

BernardSmith said:


> I am scratching my head trying to make sense of this acquisition.



If you go back to Prohibition, Augie Busch converted his company to selling LME at that time to still produce but skirt the laws, so there is a company history way back of selling supplies.

To me, the sense comes when you realize the word "disruptive." This is going to eventually be a major shock to the sector. They have the power to become literally the Wal-Mart of home brewing, and if you look at what ABI has done in so much of the beer industry, they might have the actual will to do it, too.

That will squeeze all the smaller online and local competitors, and put a huge competitive weight on Carlsen and the other suppliers, most of whom also supply the brewery industry.

Plus, the way they acquire through this subsidiary company avoids regulatory issues because this area is not as consolidated as beer is. We may see other larger home brew and winery supply retailers selling to ABI, too. 

Seems to me ABI is clearly learning some things from watching Constellation Brands.


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## jgmann67 (Oct 19, 2016)

jswordy said:


> You don't go from $7 a six-pack to $8.99 a 12-pack and not make some sacrifices. It still has a wee bit of the distinctive flavor, probably from the yeast profiles, but not at all like it was in the 1990s. I can tip up a RR now and just let it go right down similar to Bud Light. Could not do that in the '90s, and didn't want to because of the flavor.
> 
> I wish I had some of that original yeast.
> 
> ...




When AB bought RR, they shut down operations in Latrobe, PA and moved (I believe) to Newark, NJ. It was SOP for AB to buy a competing brand and then kill it.

There was a point in history that AB was in negotiations to buy Yuengling (America's Oldest Brewery). As the legend goes, **** Yuengling sought a face-to-face and a handshake from Auggie. Auggie refused, and **** told him he could go £#€% himself, **** would never sell to him.

Instead, **** expanded markets up and down the Eastern seaboard and as West into Ohio. Now, Yuengling is the largest American-owned brewing company in the US. All I can say - if it's true, thanks Auggie.

(Where you see ****, think nickname for Richard).


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## ceeaton (Oct 19, 2016)

jgmann67 said:


> (Where you see ****, think nickname for Richard).


Yes, he goes by that nickname. I went to college with his nephew (David), who I believe started the Ice Cream branch back up not too long ago. Haven't seen it in stores around here yet, but I'm not much of a dessert eater, a good beer or glass of wine equals dessert to me.


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## orto (Oct 19, 2016)

They ruined Bass too. It doesn't even taste close to what it used to taste like.


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## jswordy (Oct 21, 2016)

jgmann67 said:


> When AB bought RR, they shut down operations in Latrobe, PA and moved (I believe) to Newark, NJ. It was SOP for AB to buy a competing brand and then kill it.
> 
> There was a point in history that AB was in negotiations to buy Yuengling (America's Oldest Brewery). As the legend goes, **** Yuengling sought a face-to-face and a handshake from Auggie. Auggie refused, and **** told him he could go £#€% himself, **** would never sell to him.
> 
> ...



I just talked to someone in the financial and beer industries yesterday who is familiar with the deal. He said ABI was firm that as a condition of the deal the Latrobe plant must be sold to a company that agreed to employ the workers for a minimum of two more years. I believe he said it was an energy drink company that bought the plant. Yes, brewery operations were moved to NJ. 

Yuengling is not the same beer it once was, either. It has had the flavor profile altered, probably for economic reasons (adjuncts) since it is now attempting - at least in my market - to price itself at about the same point as Budweiser. Adding adjuncts is not necessarily a bad thing from a mass marketing standpoint, either. It makes the beer more accessible to the masses, though not to the craft types.

I'm on the fence about ABI buying up brands, since I own stock in brands in which ABI is a major shareholder and is considering buying, and so I would profit by that.


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## jgmann67 (Oct 21, 2016)

When InBev sold to AB, the brewery was not included - only the brand and the recipe. City Brewing from WI purchased the brewery in 2006. It's been a 'contract brewer' pretty much ever since. They've brewed Sam Adams, Iron City, Dusquesne Pils, Lion Brewing products and, most recently, Red Stripe and Guinness Blonde. 

I'm sure the deal regarding employment of its existing workforce was tied in to the collective bargaining agreement that they had executed the year prior to the sale (a six-year contract). 

Interestingly, ABI announced last year that it will no longer use bottles for RR... will only be available in cans.


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## jswordy (Oct 25, 2016)

jgmann67 said:


> When InBev sold to AB, the brewery was not included - only the brand and the recipe. City Brewing from WI purchased the brewery in 2006. It's been a 'contract brewer' pretty much ever since. They've brewed Sam Adams, Iron City, Dusquesne Pils, Lion Brewing products and, most recently, Red Stripe and Guinness Blonde.
> 
> I'm sure the deal regarding employment of its existing workforce was tied in to the collective bargaining agreement that they had executed the year prior to the sale (a six-year contract).
> 
> Interestingly, ABI announced last year that it will no longer use bottles for RR... will only be available in cans.



ABI currently brews Rolling Rock at several of its facilities. There's another City Brewing facility at Memphis I am familiar with that brews a lot of different brands, as well.


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