News From Spoogeland

If you aren't a regular reader, then this counts as Cliffs Notes: There are tickers, as celebrated in Phil Parkins' film, and whom I enjoy a lot. Then there are Spoogebeerians. These are the fanboys of the beer-ticking world, the uber-tickers. They outgrew comix and now they're going after beer. They want more than a tick, they want the brewer too. They'll go to extraordinary lengths to obtain rare beer ('Spooge') and have created the hothoused eBay secondary market for such beers. They can usually be found in their online hives at BeerAdvocate or Ratebeer.com. You can find a UK hive dedicated to BrewDog at their website blog.

ITEM! Tasting beer without drinking it? Are you serious? Seems a member at ratebeer was, forcing admins to lock down a thread after things got heated. It's bad enough that you can 'rate' a beer off a 1oz. sample, and I'm on the record with my opposition to reducing beer to a set of numbers, but to suggest you can fully experience beer by sipping, swilling and spitting out is just wrong. String this guy up by his tongue until he's sorry!

ITEM! Speaking of the Land Of The Locked-Down Thread (AKA BeerAdvocate), word reaches me that two members have developed the beer trading equivalent of the Duckworth-Lewis method to rank beers offered for trade. Seems some people are less than happy that they are getting less than they offered. so as a public service a matrix (uh oh!) has been created that will calculate the relative merits of beers for trade.

I can remember when these sites were communities of discussion and debate, about sharing a love of beer, about meeting new people and sharing opinions and info about favourite beer. Now they're marketplaces where the dickwavers come to offer their muled Kate The Greats or Dark Lords, while the level of discourse rarely moves above "what's in your fridge?" Sad.

ITEM! If you bought a BrewDog equityforpunks share (see previous posts) then you will be an interest holder in fabled Anchor Brewing in San Francisco! Keith Greggor, CEO of Griffin Group, who recently bought out Fritz Maytag, took time out from the busy handover programme to confirm the relationships between the LLCs means EFP investors will have a tiny part of the new Anchor Brewing & Distilling operation. It will be for BrewDog UK to decide what happens with dividends, and if I remember rightly, no dividend can be paid on an EFP share before 2012 at the earliest, but watch for more info. BrewDog should also let you know about tax liabilities.

ITEM! In local news, you might remember the acclaimed Cask Pub & Kitchen in Pimlico were having problems with hopeless rating site Beer In The Evening (or BITE). I hear there was an amusing postscript to the story. When Cask tried to join the site and paid their membership fee, meaning to use this route to get to the bottom of their supposed misdeeds, after a day or so they were contacted and informed their money was being refunded, that they not welcome, and that any further attempts to inquire would result in legal action. Cask then apparently offered to buy the BITE site.

These ratings sites are pathetic. They provide a forum for dimwits who think they are Egon Ronay who can hurt legitimate businesses with their narrow opinions and petty vendettas. And, lest it need repeating, my favourite pub ain't your favourite pub. We all like different things. Bear that in mind if you have to refer to one of these sites, and remember also that BITE only cares about hits. They're owned by a company that operates dating sites, so they know (and care) bugger-all about pubs.

implicationsforpunks: News From BrewDog

Following my previous post, I dropped an email to both BrewDog and The Griffin Group, to ask for some clarity on the situation re: equityforpunks shareholders and the plan to subsidiarise BrewDog USA LLC (the joint venture vehicle set up ahead of the IPO to manage the brewer's US business) into the new Anchor Brewers & Distillers LLC that has been set up to manage the new operation.

I asked the following questions:

I was curious to note that your US joint venture with Griffin, BrewDog USA LLC has been subsidiarised (they say 'affiliated', but I believe it's the same thing) to this new venture. What implications does this have for the operation of the joint venture?

What about the equityforpunks investors? You said in October 2009 that EFP investors would 'own' the new venture - I assume you meant become members of it as investors. Does this news change the landscape in terms of dividend on earnings?

Are you able to tell me in which state BrewDog USA LLC was incorporated?

Does BrewDog USA LLC pay taxes on earnings?

Is BrewDog USA LLC a so-called "flow-through entity" (FTE)?

I received a reply from "Emperor Penguin" James Watt, saying that he couldn't confirm details yet, and that an article would be published to the Equity For Punks website in due course. Since this particular stock isn't in the Boggle portfolio, I'd appreciate anybody with access keeping me posted.

The Anchor Brewing Sale: implicationsforpunks?

The craft beer world witnessed a changing of the guard yesterday, as US craft legend Fritz Maytag sold his Anchor brewing and distilling businesses to The Griffin Group.

Maytag famously bought the moribund brewery while twiddling his thumbs as a post-graduate student in San Francisco in 1965, learned brewing, improved the quality of his beer and identified a new market for high-quality local beer at a time when brewing in the US was dominated by a handful of giant brewers. According to Maureen Ogle in her "Ambitious Brew", Maytag bought his initial 51% stake in the brewery from two marketing types who couldn't work out how to make money from the business. So perhaps there's some symmetry to his selling out to Griffin, an "alcoholic beverage" consultancy.

It seems the announcement of the deal was mishandled, and Griffin's press release leaked out early Monday afternoon local time, and was picked up by mainstream local media later on Monday. Nobody was in a position to answer any questions until Tuesday (the scheduled announcement day), but the deal was confirmed and principals in a position to respond to questions.

In the footnotes to the deal announcement, was a reference to BrewDog USA LLC. This company was set up to handle the brewer's US business, and is described thus in Griffin's press release from yesterday.

BrewDog PLC is UK’s leading craft beer brewery and Scotland’s largest independent brewery. The Griffin Group acquired a minority stake in BrewDog in 2009 and formed a joint venture, BrewDog USA, to further develop BrewDog’s US presence.

(We'll overlook this "UK's leading craft beer brewery" statement)
BrewDog USA LLC is to be affiliated to the new Anchor Brewers & Distillers LLC, which the new owners have established to manage the Anchor operation.

So far, so good. But what I'm wondering is, does any of this have any implications for those people who invested in the "Equity For Punks" IPO BrewDog issued last autumn? In a blog post on 22 October, James Watt had this to say:

In addition we have set up a US Company (BrewDog USA LLC) to handle sales and marketing in the US. Equity for Punks investors will also own part of this company.

I tried to find out more about US LLC incorporation requirements, and it seems that EFP investors couldn't 'own' BrewDog USA LLC, but instead would be members, since rules allow investors to participate. They would be able to take income from earnings, presumably nett of local taxes.

LLCs can act as standalone entities, enabling businesses to operate in diverse markets and industries without extending liability to non-relevant areas. However, it does seem strange that Griffin would want to pop BrewDog USA LLC under their new Anchor umbrella.

I expect their reasons for this, as well as their plans and vision for the new business, will be shared over time. Opinions around the blogosphere and on boards is split about the future for Anchor, but we'll all have to wait and see. In the meantime, if you bought an EFP share, you might want to ask BrewDog what this means to you.