News The End of Green Flash & Alpine?

Discussion in 'Beer News & Releases' started by MostlyNorwegian, Apr 3, 2018.

  1. MostlyNorwegian

    MostlyNorwegian Devotee (489) Feb 5, 2013 Illinois

    The problems of Green Flash have reached something of a less than triumphant conclusion.

    https://thefullpint.com/beer-news/g...reclosed-sells-green-flash-and-alpine-assets/


    “Dear GFBC, Inc. Shareholders,

    On behalf of myself and the Board of Directors of GFBC, Inc. (the “Company”), I am truly sorry to report that the Company’s senior lender, Comerica Bank, has foreclosed on its loans and sold the assets of the Company (other than the Virginia Beach brewery) to WC IPA LLC through a foreclosure sale which closed on March 30, 2018. As such, the Company no longer owns the Green Flash and Alpine businesses. Comerica Bank is currently conducting a separate process to sell the Virginia Beach brewery

    After a general slowdown in the craft beer industry, coupled with intense competition and a slowdown of our business, we could not service the debt that we took on to build the Virginia Beach brewery — and in early 2018, the Company defaulted on its loans with Comerica Bank. While we took substantial efforts to recapitalize the Company over the past several months, both before and after the bank default, we were ultimately unable to close a transaction.

    While the Green Flash and Alpine brands will continue, they will do so under new ownership — and GFBC, Inc. and Alpine Beer Company, Inc. will be wound down and dissolved. I sincerely thank you for your support over the years.

    Sincerely,
    Mike Hinkley
    CEO
    GFBC, Inc.”
     
  2. EnronCFO

    EnronCFO Devotee (488) Mar 29, 2007 Massachusetts

    I'd just like to say that Dick Lobo, the new owner/president, is a fantastic name.
     
  3. JackHorzempa

    JackHorzempa Poo-Bah (3,618) Dec 15, 2005 Pennsylvania
    Premium

    From the Full Pint article:

    “Green Flash and Alpine assets have been sold to a risk management company in Michigan named WCIPA, LLC. We are still trying to learn more about this company.”

    Does anybody know more or has a better understanding of the bold portion above?

    From the Mike Hinkley letter:

    “While the Green Flash and Alpine brands will continue, they will do so under new ownership…”

    Is the intention that the new owner (a risk management company) will continue brewing Green Flash and Alpine beer at the California brewery?

    Cheers!
     
    kemoarps likes this.
  4. EnronCFO

    EnronCFO Devotee (488) Mar 29, 2007 Massachusetts

    The new owner is a PE-owned structure. Dick Lobo has apparently been a Green Flash board member for the last year: https://www.linkedin.com/in/richard-lobo-a853698/
     
  5. reefer_bob

    reefer_bob Aspirant (280) May 13, 2014 California
    Trader

    Wow, wow, wow.

    I hope for an independent Alpine again! :slight_smile:
     
  6. JackHorzempa

    JackHorzempa Poo-Bah (3,618) Dec 15, 2005 Pennsylvania
    Premium

    Does that 'structure' intimate they want to continue brewing beer or are they just in a 'holding pattern' until they can realize some money (e.g., sell off assets)?

    Cheers!
     
    LuskusDelph likes this.
  7. chipawayboy

    chipawayboy Devotee (429) Oct 26, 2007 Massachusetts

    Whatever happens with this collosal mess — please please please — will Lord Lobo find a way to brew Alpine Nelson again to its original specs and restore that once proud/top 50 BA Beer to its past glory??
     
  8. EnronCFO

    EnronCFO Devotee (488) Mar 29, 2007 Massachusetts

    Impossible to know. His background is in growth equity, not restructuring. Typical structure is buy into a healthy company, typically from a founder looking to cash out/retire, and then look to make acquisitions within that sector to fuel growth, stripping out expenses along the way. Case studies are provided here for example: http://www.chsonline.com/portfolio/case.html

    Done right, it's a great model and many very successful businesses have been built this way. However, this is a broken company in an industry without top line growth. So, this is a different approach than how he's operated in the past.
     
  9. Oktoberfiesta

    Oktoberfiesta Aspirant (235) Nov 16, 2013 New Mexico

    No joke. Just dump the GF name and become hyper local or regional with Alpine. They were the ‘it’ brewery before SD had any. Can there be a resurgence? With so much debt, it doesn’t feel like they can or want to go small again.

    Maybe the original alpine guys can produce their ipas elsewhere (or maybe they have already). From big time to nothing in 3 1/2 years. Scary.
     
    Bitterbill likes this.
  10. THANAT0PSIS

    THANAT0PSIS Crusader (747) Aug 3, 2010 Wisconsin
    Trader

    Not too upset to see Green Flash go with Rayon Vert four-packs long gone, which was by far their best beer. I also enjoyed Palate Wrecker back in the day (and Green Bullet to an extent), but they have been languishing hard for a very long time. And they killed Alpine, and for that there can be no forgiveness or sorrow at their demise.

    I hope Alpine comes out of this, expands on their own, and finally reaches the potential they always had.

    It is truly crazy (and terrifying) that a brewery as big as Green Flash was could wither to nothing in such a short time.

    With Stone's previous (over-)expansions that caused them layoffs not so long ago, I hope we do not see a similar eventuality come to pass as we are here with Green Flash.
     
  11. JackHorzempa

    JackHorzempa Poo-Bah (3,618) Dec 15, 2005 Pennsylvania
    Premium

    Yup, Green Flash/Alpine is most definitely a "broken company" right now. I suppose we will have to take a 'wait and see' approach here and see what WCIPA, LLC decides to do with the mess.

    I feel sorry for the former Green Flash employees. This must be unsettling times for them.

    Cheers!
     
  12. beernuts

    beernuts Disciple (321) Jan 23, 2014 Virginia

    Does anyone else find it interesting that they are being sold to a company called "WC IPA", considering "west coast IPA" is one of their flagships?
     
    stevesbeer, kemoarps, Sabtos and 15 others like this.
  13. threeviews

    threeviews Zealot (554) Apr 18, 2011 Florida

    This is certainly insalubrious news in the wake of the massive growth experienced in the craft beer industry...

    I can only comment on my personal observations:
    1 - Green Flash beers were much more available on the East Coast (NJ - specifically) when they only operated the Sand Diego location...the last time I saw Palate Wrecker, Green Bullet or even a fresh West Coast IPA has to be years.
    2 - Being on the East Coast and have never having Alpine beers, the less-than-complimentary reviews of Alpine since they were acquired were less than positive. As a result, even when I came across them I passed.
    3 - The Green Flash beer portfolio shrunk in the last couple of years...

    For such a successful brewery, it is hard to imagine how things went awry so quickly...I hope this doesn't start a trend...:slight_frown:
     
    Hatzilla and bgold86 like this.
  14. rfgetz

    rfgetz Poo-Bah (2,349) Nov 14, 2008 New Jersey

    http://www.sandiegouniontribune.com/business/sd-fi-green-flash-foreclosure-20180403-story.html

    This article is pretty insightful... including a juicy nugget

    "McIlhenney and his wife -- Val McIlhenney, who was vice president of Green Flash’s Alpine Beer division -- will have no role in the new company. Their son, Shawn McIlhenney, remains under contract as a Green Flash brewer.

    Hinkley, who started Green Flash 16 years ago, will lead the new company, according to a news release, although a document from the California Department of Alcoholic Beverage Control identifies him as vice president.

    McIlhenney had harsh words for Hinkley.

    “He has no business being in this business,” McIlhenney said. “His business prowess is abysmal.” "
     
  15. zid

    zid Champion (867) Feb 15, 2010 New York

    According to the Green Flash press release, both the Green Flash and Alpine breweries will continue to operate as the company transitions to a regional southwestern footprint.
     
    Wasatch, JackHorzempa and Bitterbill like this.
  16. HouseofWortship

    HouseofWortship Devotee (450) May 3, 2016 Illinois


    I read that too and immediately thought who hires the guy who messes up the company? Sounds like a good way to get McIllhenney and any equity they were owed out of the equation and then start brewing as usual.... I think there is a deeper story here...
     
    chrismattlin and sharpski like this.
  17. UtahBeerPleb

    UtahBeerPleb Initiate (169) Dec 2, 2017 Utah

    The bigger they are, the bigger they fall...
     
  18. Can_has_beer

    Can_has_beer Champion (894) May 14, 2013 Texas

    I think I'm in the minority of those who enjoy Alpine Windows Up?
     
    IceAce, maximum12, eppCOS and 5 others like this.
  19. donspublic

    donspublic Poo-Bah (1,553) Aug 4, 2014 Texas
    Premium Trader

    No great beer, I even enjoyed gf spanish trampoline
     
  20. peteboiler

    peteboiler Initiate (130) Dec 16, 2010 Florida

    I read the article and all of the replies and still find myself confused. What does this mean for the actual BEER? Will it still be brewed and distributed as Green Flash and Alpine? But sad news indeed for those losing their jobs...
     
  21. BeanBump

    BeanBump Aspirant (230) Dec 14, 2016 California

    Forget Green Flash and Alpine, the real tragedy here is that Cellar 3 shut down. That was the only GF entity that made anything with consistent quality.
     
    BigIslandfarmer, dvmin98 and IPA_Lush like this.
  22. Riff

    Riff Crusader (708) May 12, 2016 Virginia

    Not sure on that one, but I enjoyed the Hoppy Birthday my wife liked to buy for my birthday.
     
    Spikester and deanzaZZR like this.
  23. zid

    zid Champion (867) Feb 15, 2010 New York

    I mean no offense to Cellar 3, but "consistent quality" (literally speaking, as opposed to liking or disliking a beer) isn't what I think of when it comes to Cellar 3:
    https://www.beeradvocate.com/community/threads/green-flash-silva-stout.296196/
     
    Lucular, DRGinLBC, ChrisPr and 14 others like this.
  24. hoppytobehere

    hoppytobehere Crusader (719) Aug 10, 2012 District of Columbia

    What's crazy is the amount of terrible decisions they've made in the past few years. It's just finally catching up to them.
     
  25. TrojanRB

    TrojanRB Meyvn (1,133) Jul 27, 2013 California
    Premium Trader

    Green flash is terrible. I hated them before the Alpine deal, and I hate them even more afterwards.

    The only tragic thing is that they might drag Alpine under with them. Wonder how much money it would take to split OG Alpine off?
     
    Brent212 and hoppytobehere like this.
  26. Boomer4ES

    Boomer4ES Aspirant (299) Jan 31, 2012 North Carolina

    1 - Green Bullet and Palate Wrecker have been discontinued for a few years. Palate Wrecker came back last year as a very limited offering.
    3 - They should have reduced the portfolio long before they did. Portfolio shrinkage is not always, and in my experience, not often a bad thing. Having a crowded portfolio full of dozens of specialty beers and multiple lines of rotating seasonals typically only serves to draw attention away from the core beers which are supposed to be the ones that keep the lights on. You often end up causing consumers to forget about why they liked the brand in the first place and move on to something else after they try whatever the next specialty or limited release is.
     
  27. Boomer4ES

    Boomer4ES Aspirant (299) Jan 31, 2012 North Carolina

    Thank you. I have seen countless people giving them the benefit of the doubt and blaming this on a competitive market, when in reality this is purely a result of poor business decisions and bad management. This is not a sign of anything for craft beer as a whole. It is simply a prime example of what not to do with a brewery.
     
  28. AZBeerDude72

    AZBeerDude72 Meyvn (1,296) Jun 10, 2016 Arizona
    Premium Trader

  29. Tdizzle

    Tdizzle Zealot (505) Dec 19, 2006 California

    Just curious, what are the bad business decisions that they made? I'm unfamiliar with their history, other than I used to love "West Coast IPA," and then they went in a completely different direction; and they lost me.
     
  30. Rossdbos1

    Rossdbos1 Initiate (0) Feb 12, 2018 California

    This whole thing needs a lot more explanation...
    I have a few bullets with questions & thoughts
    • Mike Hinkley releases this statement to his previous investors: “While the Green Flash and Alpine brands will continue, they will do so under new ownership — and GFBC, Inc. and Alpine Beer Company, Inc. will be wound down and dissolved.”
    !!!! DISSOLVED !!!
    Bye Felicia! No more GF. No more Alpine

    • An investment group who’s head specializes in aquiring assets & selling them buys the brewery from the bank through a foreclosure sale. He hires an ex mergers guy from AB INBEV and Mike Hinkley the failed CEO to run the new operation. WTF!!!?
    My thought is they will prop this company up until they can sell it’s assets. If the brands are part of the deal, expect to see “Nelson Light” on the shelves Summer 2019
    Hinkley had to have cut a deal to get something after they sellout.

    • From Mike Hinkley: “I apologize to Pat and Val McIlhenney because this is not how they or I would ever have wished things would turn out. I am glad they took the most of their money out of the company by now. I wish they would have gotten it all out. I wish things turned out exactly as they hoped when they sold Alpine Beer Company four years ago."

    Looks like Pat got screwed out of his Alpine money by this shit bag. Really sad.

    • It's also crazy that Hinkley will be running the new company after screwing all his investors & Pat out of their money. I never heard of a company getting foreclosed on then the ex CEO runs the new company. It's really unheard of.
    Typically companies go into bankruptcy to protect from debt to protect their investors and restructure. Hinkley secured a golden parachute. He basically screwed all his investors and the Alpine folks and still runs the show. None of this makes sense. In the future, I would not be surprised to see some huge lawsuits filed by GFs original 50 investors.
     
  31. TrojanRB

    TrojanRB Meyvn (1,133) Jul 27, 2013 California
    Premium Trader

    Reformulating their flagship WC IPA
    Changing their branding/label art to Microsoft word
    Discontinuing well received beers like Rayon Vert, etc
    Shifting from 6 packs to 4 packs but keeping pricing same
    Running Alpine into the ground....

    I will never, ever, forgive them for what they did to Alpine. Alpine was arguably the best brewery in SoCal and they destroyed the quality of beer and totally botched distribution.

    I’m glad to see green flash go out of business. The free market is alive and well, and punishing a terrible business.
     
    stevesbeer, Kadonny, Soneast and 21 others like this.
  32. SammyJaxxxx

    SammyJaxxxx Poo-Bah (2,183) Feb 23, 2012 New Jersey
    Premium Trader

    This whole thing is similar to Toys R Us going out of business It isn't a reflection of the business. If the debt is too much they have no chance
     
  33. Tdizzle

    Tdizzle Zealot (505) Dec 19, 2006 California

    Thank you for the thorough response. I completely agree with you regarding their mishandling of the Alpine transition. Alpine was in a league of their own, and GF ruined those beers, IMO.

    I suppose I knew the answer to my question all along, because Green Flash has always puzzled me -- in the way they "evolved." They had a great flagship beer that they needlessly tweaked, and, as a result, made it worse. They have a great name; and their logos were cool. The new emphasis on vintage, simplistic-style artwork would have suited GF well if they hadn't scrapped their old logos for that horribly generic artwork that they currently use. Seems like they ran a potentially great company into the ground.
     
    #33 Tdizzle, Apr 4, 2018
    Last edited: Apr 4, 2018
  34. readyski

    readyski Aspirant (222) Jun 4, 2005 California
    Trader

    Sorta karmic after Nelson and Rayon Vert debacles. Hell those alone would make them worthy again. Pulling for the powers that be to become enlightened.
    Otoh some failure/restructuring with a large brewery is healthy for the industry (aside from those adversely affected). Don't think it's even plateaued but Darwin should play a role :wink:
     
  35. jageraholic

    jageraholic Disciple (318) Sep 16, 2009 Massachusetts
    Trader

    I would add redesigning a label to have a white box for a born on date and then never using it. That was the end for me.
     
    bound4er, RyanK252, pjeagles and 5 others like this.
  36. jrnyc

    jrnyc Meyvn (1,307) Mar 21, 2010 New York
    Premium Trader

    It seemed like every other month for a couple of years they switched whether and how they would show dates. Where, color, showing,not showing, empty white box, format, etc. Green Flash WCIPA was my first love in craft beer, but inability to get it fresh and to even know whether it was fresh combined with explosion of local breweries in my area ended it for me. Not to mention how the ruined Alpine.
     
  37. southdenverhoo

    southdenverhoo Disciple (351) Aug 13, 2004 Colorado

    So if I understand correctly there’s a 58,000 sq. ft. Brewery and taproom, probably state of the art, for sale in Virginia Beach, for literally whatever the foreclosing bank can get for it, not too long after a certain still-expanding brewery with international aspirations and deep international pockets bowed out of a planned Charleston SC facility, it’s first foray onto the eastern coast of the US, because the building just needed too much work to make operational.....

    Mr. Magee, Mr. Tony Magee, please proceed to a white courtesy telephone. Paging Mr. Magee....
     
    jamvt and rodbeermunch like this.
  38. jesskidden

    jesskidden Meyvn (1,313) Aug 10, 2005 New Jersey

    That South Carolina brewery Lagunitas bought was usually described as a "taproom/event space", rather than a production brewery, so it's not as if they lost a lot of potential capacity by giving up on it.

    But, yeah, if they need capacity beyond Petaluma and Chicago (not sure exactly what the status/capacity of their Azuza brewery is at this point - when announced it was going to be a 400k-1m bbl facility) a "turnkey" Virginia brewery seems ideal.
     
  39. southdenverhoo

    southdenverhoo Disciple (351) Aug 13, 2004 Colorado

    Yeah, I’ve been to the place in Charleston when it was Southend. It did have some 30bbl fermenters IIRC, wasn’t tiny but certainlywas nothing like a 58k sq ft production facility/taproom. I’ve never been to Green Flash VB but it sounds closer to the Chicago Lagunitas than the Charleston one, for sure..
     
  40. surfcaster

    surfcaster Crusader (733) Apr 20, 2013 North Carolina
    Premium Trader

    That is correct. The SC place was in the heart of the tourist district (I lived a block away during my naval service in the late 80s/early 90s) and a beautiful old building that housed a restaurant/bar then and later a brewpub. It was not of the remotely the size or scope of the Va Beach facility.

    I just hope Alpine can be revived to its former glory. I am certain that original Nelson would still resonate despite all of the new processes and beers these days...to me it was that unique.