Pabst claims MillerCoors is trying to put it out of business

Discussion in 'Beer News' started by pat61, Nov 12, 2018.

Thread Status:
Not open for further replies.
  1. pat61

    pat61 Initiate (0) Dec 29, 2010 Minnesota

  2. Sweatshirt

    Sweatshirt Initiate (0) Jan 27, 2014 New Hampshire
    Deactivated

    I won't be happy if PBR goes away.
     
    Dan_K, lrend13, kevanb and 8 others like this.
  3. tone77

    tone77 Grand Pooh-Bah (4,153) May 20, 2009 Pennsylvania
    Pooh-Bah Society

    PBR, Colt 45, and to a lesser extent Natty Bo are in my regular rotation of cheap beers. I would hate to see them disappear.
     
  4. Premo88

    Premo88 Grand Pooh-Bah (3,486) Jun 6, 2010 Texas
    Pooh-Bah Society

    Not surprising, and it's not really a macro brewery trying to kill a craft brewery, is it? In fact, if MillerCoors brews, packages and ships Pabst products, what the hell does Pabst do? The business world seems like the most unscientific, unlogical thing ever created, but I'm pretty stupid, so I'm sure it's just me.

    I'd hate to lose Lone Star and Lone Star Light, but we'll be fine if they die.
     
    TrojanRB, pat61, dcotom and 2 others like this.
  5. bbtkd

    bbtkd Grand High Pooh-Bah (7,326) Sep 20, 2015 South Dakota
    Pooh-Bah Society Trader

    Seems like PBR was living on the edge, knowing the contract was running out, knowing they had no alternative brewers, and knowing they they were competing with MC - their contractor.

    MC can hardly be blamed for not wanting to renew, allowing them to close inefficient plants, and concentrate on their own production efficiency. So, will the courts force MC - against their best interests - to continue supplying a competitor in a shrinking market?

    I'm not a lawyer, but I'm not a believer in forcing one company to do business with another. Say that MC is forced to renew the contract on terms acceptable to PBR. Won't they both still be looking for a mutually exclusive advantage over the other, constantly bickering in court? Kind of like forcing a couple to stay married when they want a divorce. I'm afraid the only alternative is to sell out to someone with enough brewing capability. So - is that MC's end game, forcing PBR to sell out?
     
    Premo88, pat61, dcotom and 1 other person like this.
  6. BBThunderbolt

    BBThunderbolt Grand High Pooh-Bah (7,282) Sep 24, 2007 Kiribati
    Pooh-Bah Society Trader

    A: Hamms is what peeber was a decade ago.

    B: Maybe the hidden meatwads that own the peeber brands should shut up and build their own damn factories.

    C: Hahahahaha at a company who only owns "brands" trying to tell a company who actually owns facilities that they MUST manufacture products.

    I'mma start a car company, call it Pontiac, and make GM build my cars.
     
    DucRacer900, Premo88, MikeP64 and 8 others like this.
  7. jesskidden

    jesskidden Grand Pooh-Bah (3,071) Aug 10, 2005 New Jersey
    Pooh-Bah Society Trader

    Most industry analysts point to Pabst's moving their contract brewing from Stroh (which took over Heileman a couple years earlier and which had been doing a lot of brewing of Pabst brands) to Miller in 1998 as the final straw that pushed Stroh into leaving the industry in 1999.

    At that point, Pabst still had a few of breweries left (ex-Olympia in Washington, ex-Pearl in Texas and, briefly running the Stroh brewery in PA) but soon closed them as soon as Miller was able to move production around to accommodate the expanded Pabst portfolio (Pabst bought most of the S-H brands, with Miller picking up a few of Pabst and S-H brands) and they proudly proclaimed themselves a "Virtual Brewer". (The CEO at the time was quoted as saying "Why would I want to own a brewery?")

    Of course, what the article in the OP neglects to mention is that both companies (MC and Pabst) were under totally different ownership when that initial Pabst/Miller contract deal was initiated in 1998. Pabst was still run by the estate of the former owner, Kalmanovitz Charitable Trust, and Miller was owned by Philip Morris.

    As for the Pabst brands if Pabst left the business, it is likely that MillerCoors and/or other company(ies) (but at this point there are not many left with the excess capacity- NAB, maybe? A non-brewer contracting with City and others?) would buy many of them - to maximize capacity, if nothing else-since they are pretty much the only thing Pabst "owns" and they still have some value. Heck, given AB's new ownership, they also might be interested in some, if the DoJ would allow it.
     
    #7 jesskidden, Nov 12, 2018
    Last edited: Nov 12, 2018
  8. bbtkd

    bbtkd Grand High Pooh-Bah (7,326) Sep 20, 2015 South Dakota
    Pooh-Bah Society Trader

    I agree about the part where one company shouldn't be forced to contract to another. The gotcha here - depending on the court - is how they interpret the previously equitable agreement between MC and PBR and decide whether it sets ongoing commitment/precedence of any kind. Doesn't sound like PBR will prevail, but some judge might order a year or two extension of the relationship to give time to sort it out, though they have both had 20 years to see the end coming, with one looking forward to it and one not.
     
    #8 bbtkd, Nov 12, 2018
    Last edited: Nov 12, 2018
    BBThunderbolt, pat61 and cavedave like this.
  9. jesskidden

    jesskidden Grand Pooh-Bah (3,071) Aug 10, 2005 New Jersey
    Pooh-Bah Society Trader

    Not really. The "Miller Brewing Co." that first started contract-brewing Pabst brands in the late '90s no longer exists and what remains of it today, 5 US breweries and numerous brands, has been wholly-owned by Molson Coors only since 2016.

    Likewise, the "Pabst Brewing Co." has been sold twice since the late 1990s and previous to those sales had closed its remaining breweries. The current ownership (Kashpar and TSG Partners) only took control in 2014.

    According to reports at the time, when the Metropoulos family bought Pabst in 2010, the contract (then set to expire in 2014) was renegotiated "long term" with MillerCoors.
     
    #9 jesskidden, Nov 12, 2018
    Last edited: Nov 12, 2018
  10. bbtkd

    bbtkd Grand High Pooh-Bah (7,326) Sep 20, 2015 South Dakota
    Pooh-Bah Society Trader

    Whatever contract end date was in place, they had both agreed to it and had plenty of time to plan, and even through ownership changes they should be well aware of any agreements and contracts in effect.
     
    TrojanRB and BBThunderbolt like this.
  11. cavedave

    cavedave Grand Pooh-Bah (4,145) Mar 12, 2009 New York
    Pooh-Bah Society Trader

    This is like Godzilla fighting King Kong. Don't really care who wins, and it is a fight likely to be fun to watch.
     
  12. jesskidden

    jesskidden Grand Pooh-Bah (3,071) Aug 10, 2005 New Jersey
    Pooh-Bah Society Trader

    This particular legal battle has been going on for more than 3 years now, since negotiations started in the Fall of 2015 (around the same time MC announced the closing of their Eden, NC brewery), as noted in this Milwaukee Business article, dated May, 2016.
     
  13. zid

    zid Grand Pooh-Bah (3,058) Feb 15, 2010 New York
    Pooh-Bah Society Trader

    Craft fans picturing King Kong fighting Godzilla are probably imagining it like "King Kong vs Godzilla" from 1962 where King Kong was scaled up to Godzilla's size... a battle of titans that would look nothing like Godzilla fighting the far smaller "real" King Kong from 1933, although that size difference would be a far more fitting image. It's not like these entities are a comparable size. I think Sierra Nevada has far more employees than Pabst Brewing Company.
     
  14. MoreBeer4me

    MoreBeer4me Initiate (0) Aug 25, 2014 New Jersey

    This would be bad news for me as PBR is one of my few and favorite ordinary beers. My god, it blows the doors off of Miller and Bud. Miller should just buy it and do some marketing for the brand.

    On another note, I find it amazing that Bud does no contract brewing. I drank a few Bud's at my fathers house this weekend and was scratching my head as to why people buy and drink that crap. Its so bad, there has to be substantial excess brewing capacity available.
     
  15. zid

    zid Grand Pooh-Bah (3,058) Feb 15, 2010 New York
    Pooh-Bah Society Trader

    Bud Light and Budweiser are two of the top three selling beers in the US, and you figure that there must be substantial excess brewing capacity because you think they're bad? I feel like it's relatively safe for me to lump those two beers together in your worldview. Um... why am I even bothering with asking this?
     
  16. cavedave

    cavedave Grand Pooh-Bah (4,145) Mar 12, 2009 New York
    Pooh-Bah Society Trader

    Haha I guess I shouldn't have referred to an actual movie. I meant it more as a battle of familiar, lumbering, giant monsters.
     
    BBThunderbolt and zid like this.
  17. Alefflicted

    Alefflicted Crusader (445) Dec 2, 2017 Minnesota

    I was thinking basically the same thing. Admittedly you said it better then I would have, so thank you good sir.
     
    BBThunderbolt likes this.
  18. MoreBeer4me

    MoreBeer4me Initiate (0) Aug 25, 2014 New Jersey

    Yes...and they used to sell a shitload more of it years ago as compared to today. As in an ENORMOUS SHITLOAD MORE. "Two of the top three" is a relative term son.
     
  19. zid

    zid Grand Pooh-Bah (3,058) Feb 15, 2010 New York
    Pooh-Bah Society Trader

    I deserved your retort, but while I couldn’t tell you about the brewing vs capacity volume of the company across all of their various brands (including The High End) and how that number fluctuates over the years when looking at the global market, you aren’t claiming that you’re doing that either. You said, “Its so bad, there has to be substantial excess brewing capacity,” right after you mentioned that people buy it. :slight_smile:
     
    BBThunderbolt likes this.
  20. IPAExpert69

    IPAExpert69 Savant (1,065) Aug 2, 2017 Pennsylvania

    I really hope Pabst survives this, such a nostalgic beer for my college days. I remember fondly yelling "PBR" when ideas about a keg were floated around. I may have been shot down for Natty Light 8/10, but those 2/10 were gloriously not as shitty!
     
    anfield86 likes this.
Thread Status:
Not open for further replies.