Pabst Brewing to buy Molson Coors’ iconic Irwindale brewery – Daily News

on May12
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Pabst Brewing Co. has announced plans to buy Molson Coors Beverage Co.’s iconic Irwindale brewery in a deal that’s expected to be completed by year’s end.

In January, Molson Coors said it would cease production at the 40-year-old facility in September. As part of an agreement, Pabst had 120 days to choose to buy the brewery for $150 million.

In a May 4 notice filed with the U.S. Securities and Exchange Commission, Molson Coors said Pabst Brewing has exercised its option to purchase the facility, industry publication Brewbound reported. Details of the pending transaction were not provided.

“We have given notice to Molson Coors of our intention to purchase the Irwindale Brewery property,” Pabst CEO and Chairman Eugene Kashper said in a statement. “We continue to evaluate this opportunity and are committed to choosing a path forward that is in the best interest of all our stakeholders.”

The brewery — which opened in 1980 and employs about 470 workers — is a well-known landmark for motorists traveling the 210 freeway.

Reduced workforce

Bill Manis, president and CEO of the San Gabriel Valley Economic Partnership, said Pabst won’t be keeping all of the current employees.

“In our conversations with Pabst, they said they are looking to have 125 to 150 employees there,” he said. “They also said they don’t need the entire (225-acre) property, so they might sublet part of it to help offset the cost of buying the brewery.”

When Molson Coors announced its plan to discontinue operations in Irwindale, Brian Erhardt, the company’s chief integrated supply chain officer, indicated Molson Coors would “support them throughout the transition.”

Talks initiated in January

Manis said the partnership initiated talks with Pabst Brewing in January in an effort to entice the company to move in.

“We brought in Southern California Edison and Southern California Gas to see if there was anything we could do to incentivize them,” Manis said. “Edison offers an economic development package with reduced rates, and SoCal Gas offers something similar. I know they were looking very seriously at that as far as power.”

Last year, the Irwindale brewery produced 4.8 million barrels of beer that were shipped to 261 independently-owned distributors. During its 40 years of operations, the facility has produced a variety of beers, including Miller Lite, Coors Light, Miller High Life, MGD, Steel Reserve, Miller 64 and several brands for Pabst.

When Molson Coors ceases production in Irwindale, its inventory of beers will shift to the company’s facilities in Golden, Colorado, and Fort Worth, Texas.

“This move will allow us to optimize our brewery footprint while streamlining our operations for greater efficiency across the network,” Erhardt said when the move was announced. “While it was a very difficult decision, we have extra capacity in our system and Irwindale’s production can be absorbed by other breweries in our network.”

Lawsuit settled in 2018

The pending acquisition follows a lawsuit between the two brewers that Pabst filed over a nearly two-decades-old brewing agreement. Pabst and Molson Coors reached a settlement in the case in November 2018.

During the trial for the lawsuit, Kashper testified that Pabst offered to buy Molson Coors’ now-shuttered Eden, N.C., facility for $100 million. Molson Coors made a counteroffer of $750 million which Kashper declined. Molson Coors ultimately sold the brewery for $2.75 million to D.H. Griffin, a demolition and site development company.

In November, Pabst entered into an agreement with Wisconsin-based City Brewing Co. to produce the company’s beers and other beverages until 2040. It’s not yet known how the purchase of the Irwindale brewery will affect that contract.

Jonathan Rodriguez, president and CEO of the Irwindale Chamber of Commerce, is glad the facility will continue to function as a brewery.

“It will be great to see the brewery stay in use for the purpose it was built for,” he said.

In 2019, Pabst ranked as the fifth-largest brewing company in the U.S., a distinction it also held in 2018, according to national trade group the Brewers Association. Production numbers for 2019 have yet to be released, but in 2018, the company shipped 4.5 million barrels.

Pabst’s brands include legacy offerings such as Pabst Blue Ribbon, Lone Star, Schlitz, Old Milwaukee and others.

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