Boozin’ Blog

Did you know that Inbev owned Labatt USA? Yeah, me neither. I’m not saying I’m surprised. It’s just that that little factoid hadn’t floated my way.

Now we all know that Labatt is Canadian. This is something that its marketers are determined not to let us forget. Labatt USA is the brewer’s legal presence in the US. It handles importing the beer, arranging for its distribution and its marketing.

While under Inbev’s control Labatt USA moved from Connecticut to Buffalo, NY. According to the article, Labatt and Anheuser-Busch brands are the two biggest sellers in Buffalo so this is a logical move. It seems likely to me that Inbev would have continued its control of the successful brand but for a requirement by the justice department that they had to unload the Blue. Apparently someone somewhere had the sense to observe that perhaps one company shouldn’t control 99.99% of the beer sold in the US.

(That’s a little joke by exaggeration for my literalistic readers. I’m aware that ABI doesn’t control quite that much but you’ve got to admit that they control a lot!)

So the company had to be sold. For a while late last year this caused some concerns but a buyer has been found. KPS Capital Partners, a New York City based private equity firm, now owns Labatt USA as well as High Falls and a license for the Seagram’s Cooler Escapes and Smooth brands. So, there won’t be any interruption in Labatt’s supply lines but there are still a few questions in the air.

Inbev had agreed to do some of the brewing of Labatt in the US. This isn’t that unusual in the business of big beer. For instance, despite its strong Irish image, very little of the Guinness drank world-wide is actually brewed in Ireland.

But Labatt has more than just a strong Canadian image. They’ve gone so far as to use the phrase “imported daily from Canada.” They would certainly lose some cache if this were no longer actually 100% true. Whether or not KPS will brew Labatt in the US is still unresolved.

Another problem is that extracting one beer company from another isn’t as easy as having the lawyers draw up the papers. US distribution is a complex and changes from state to state. In many places Labatt is distributed on Anheuser-Busch trucks. It’s going to take some time to get all of the changes in place before the brand will be entirely free of ABI.

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Well, we can finally put this one to bed. The Inbev take-over of Anheuser-Busch was settled yesterday. Now it’s up to the lawyers to work out the details. Anheuser-Busch Inbev will be the new company making Budweiser when it’s said and done. (If you want to get an in-depth look at the brewery that was Anheuser-Busch check out American Originals: Budweiser this Thursday on CNBC.)

The sun came up this morning. There were no earthquakes in St. Louis – I know because I live near enough to have felt them. Babies are being born and yeast still makes beer. The world moves on and I’ll wager that most beer drinkers won’t even really notice the transition.

Oh, there might be a bit of wailing and people swearing that they’re never going to drink “that crap” again. There are even going to be some that declare Budweiser is now undrinkable even though Inbev will have done nothing to alter the recipe. But these folks are going to be in the minority. Americans will continue buying Bud at its market leading pace and most will forget that this even happened.

But if you drink beer in the US and are determined to never drink beer brewed by a company beholden to foreign masters your choices have suddenly changed dramatically. By my estimation the biggest American owned beer maker is now Boston Beer Company. Yep, the makers of Samuel Adams!

Better yet if you really want to keep your money at home how about buying from the local brewpub? You can pop in and buy about half a gallon of beer for a reasonable price, especially when you factor in the returnable growler. And the chances that an overseas company will come in and buy your new favorite brewer out from under you are remarkably thin.

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