Anchor Brewing workers say that their Hail Mary to buy the brewery and convert it into a co-op has not been dismissed out-of-hand by parent company Sapporo.
“They basically said they are open to it, as long as we show serious funding, which we are working on, and have a serious representative — which we are also working on,” said Patrick Machel, a shop steward at the Anchor Union and the brewery’s packaging lead.
The latter is more easily obtained; this means lawyers. The unionized workers, Machel says, have obtained a brace of those, including attorneys specializing in forming a cooperative and a bankruptcy attorney. The workers are also in contact with an equity firm.
Sam Singer, Anchor’s spokesperson for this matter, said the company would “gladly consider” the offer from the subset of unionized workers — which is being made independently of the union itself — “given our deep respect for the Anchor Union and our team members.”
But, he said, “time is running short,” and the workers would have to put together “a bona-fide, legally binding offer to buy the company, one that includes a verifiable source of funds” by the start of next month.
“We continue to move forward toward an assignment for the benefit of creditors at the beginning of August,” he added, referring to the planned liquidation of Anchor’s assets in the next two weeks, “while simultaneously receiving and collecting all interest in acquiring the business.”
Sapporo, which obtained Anchor in 2017 for some $85 million, announced July 12 it was scuttling the San Francisco institution long described on its own bottle caps as America’s first craft brewery. In media statements, the international beverage giant noted that Anchor was in the red at the time of its acquisition and continued to be a money-loser, with poor trends exacerbated by the pandemic.
Anchor workers successfully unionized in 2019. Prior to the vote, full-time employees in packaging told Mission Local they were earning less than $40,000 a year; even brewers earned shy of $50,000.
Machel said he and his colleagues have not been given an idea of how much money it would take to obtain the brewery, which comes not only with intellectual property assets and equipment, but a 73-year-old Art Deco plant occupying an entire city block at Mariposa and De Haro streets, as well as the scrap of land across the street, where Anchor Public Taps is situated.
While the workers had hoped to buy some time, they have been given no indication that this will occur: Machel says that the workers were informed that, on Aug. 2, the control of Anchor and its assets passes from Sapporo to a third-party independent liquidator. Sapporo has also given no indication if it prefers to sell the brewery outright, or do so piecemeal — especially if the latter would be more lucrative and expedient.
The workers, it turns out, are not the only ones who wish to buy Anchor or its components.
“Approximately two dozen investors and individuals (including the Anchor Union) have expressed interest in acquiring all, or some, of the assets of Anchor Brewing Co.,” confirmed company spokesman Singer.
“All these inquiries will be placed in the hands of the assignment for the benefit of creditors (ABC, more commonly known as a liquidator) to make a decision on which company or individual is making the best offer for the brewing company. We remain hopeful that Anchor will be purchased and continue on into the future, but it will be in the hands of the liquidator to make that decision and is dependent on what is offered by potential purchasers.”
Where to expediently score up a serious amount of money to back up a serious offer remains the multi-million dollar question, and a matter being hammered out by the workers, the equity firm, and its burgeoning troop of lawyers. This, Machel says, will require more than a GoFundMe.
In the meantime, Machel is still showing up to work in the brewery, where he expects to be boxing up what could be the last Anchor ever made. “I know we have about four more days of packaging, mainly kegs,” he says. “These are the last two bottling runs we have.”
In his spare time, he’ll try to make sure he and others still have a job next month.
“We are hopeful, but we know it’s a big hill to climb,” he says. “We understand this, but we can’t go down without trying to save what we grew up loving and drinking. We want our kids to be able to experience this. When they’re of legal age, of course.”
Contrary to the article’s implication, it’s not a bankruptcy. There’s been no claim liabilities exceed assets. I’d be interested to understand when, in general, is liquidation preferable to a sale? Does it involve not having to disclose the financial books? Ultimately an offer to buy with the intention of continuing operation requires a business plan acceptable to the financiers. That’s very complicated, likely requiring paying up front with the idea of selling assets not required by the plan. That’s how SPACs are organized. The employees would be well advised to seek a partner willing to give them a chance to reorganize the operation in exchange for their putting up at-risk cash, possibly raised from the community.
Bill —
The article never implies that this is a bankruptcy situation because it’s not — they’re going through ABC (Assignment of Benefit for Creditors). The workers, however, have brought in a bankruptcy attorney to help with matters brewers and packagers don’t know much about. I don’t think there’s an ABC attorney out there.
All of your suggestions seem prudent.
Best,
JE
It would be nice if they do get things going if they could bring back Brekel’s Brown and Old Foghorn. I miss them as much as plain old Anchor.
They have Old Foghorn. In fact, when I was there on Sunday, they were selling 6-packs or cases of it. (I bought a pack)
i like their beer and hope that the workers can take this over and run it themselves. i’m saddened that whatever the outcome it would seem that their pensions or retirement, whatever those benefits were for the long-time workers will be scuttled with the current owners shutting it down? maybe not, hopefully i’m wrong.
Go Fund Me. I recommend it as those lawyer I bet aren’t working pro bono.
A union taking power back from corporate overlords. That is ALWAYS a good thing.
“You have nothing to lose but your chains…” ✊🏿
As we learned from Jimmy Hoffa, union overlords are even worse.
Hoffa made Vegas a union town.