E-Malt.com News article: Canada: Labatt’s Lakeport Brewery may be purchased by Calgary beverage firm

Minhas Creek, a Calgary beverage firm known for cut-price beers, says it's interested in buying Labatt's soon-to-be-shuttered Lakeport Brewery in Hamilton, Canadian Cattlemen posted on April, 14.

Minhas Creek said they plan to conduct due diligence "with an intent to keep the brewery open," emphasizing they have no plans to take over Labatt's Lakeport brand of discount beers.

Labatt said last month that it would close the Lakeport operation by April 30, putting almost 150 employees out of work.

According to the Hamilton Spectator in late March, Labatt's decision stems in part from a decision by U.S. competition regulators to block Labatt's owner, Anheuser-Busch InBev, from importing its Canadian production into the U.S. market.

The lost U.S. market left Labatt with substantial surplus beer on its hands, which it decided to absorb by closing one of its seven Canadian breweries and consolidating production into its London, Ont. plant.

The Lakeport plant "stood out as the most expensive to run," Labatt corporate affairs director Jeff Ryan told the Spectator's Meredith MacLeod last month.

The newspaper then noted Labatt was already moving to clear out the plant's brewing and bottling equipment, "seeking to make it impossible for another brewery to set up" in the building.

Minhas Creek said that they're "in the process of contacting" representatives of the City of Hamilton, Teamsters Union local 938, the Hamilton Port Authority and beverage firm Anheuser-Busch InBev, which owns Labatt, the brewery and its equipment.

Their due diligence, they said, will include a review of the lease arrangement between Anheuser-Busch InBev and its landlord, the Hamilton Port Authority, as well as the collective agreement between Labatt and its Teamster employees.

Minhas Creek also plans to analyze the water used to make beer at the Hamilton Brewery, review the production capability, capacity and replacement value of the brewery's equipment, and look at Anheuser-Busch InBev's asking price.

According to the Spectator, Labatt paid $201.4 million for the plant in 2007.

Ravinder and Manjit Minhas were still in their late teens when they entered the Alberta liquor business in 1999 and took over what's now the Minhas Creek Craft Brewery.


14 April, 2010