Monday, November 13, 2006

Lunchtime Beverage Break

Hope this quenches your thirst for a little news:

  • First reported by WBAY in Wisconsin:
A union representing office workers at Miller will vote on authorizing a strike in case a contract agreement can't be reached. The Office and Professional Employees International Union Local 35 represents more than 120 clerical workers at the Milwaukee headquarters and brewery. The union's business manager, Judy Burnick, says Miller's parent company, SABMiller, has proposed a pension freeze and health insurance concessions. The union authorized a strike six years ago, but ending up reaching an agreement.
  • Illinois bids farewell to Bell's beers (according to the Chicagoist):
"The current owner of Bell's distribution rights is Jim LaCrosse, who's the CEO of Union Beverage Company. According to Bell's brewery reps, LaCrosse was close to selling his Bell's distribution rights to Chicago Beverage Systems, a national beer wholesaler which distributes Miller, Coors, Heineken/Amstel, most of the popular Mexican beer brands, Newcastle, Stella Artois, Guinness/Bass, and countless other beer brands (they just added Sierra Nevada and Paulaner this week).
Anyway, rather than do business with Chicago Beverage, when Bell got word of the impending sale, he opted instead to stop shipping his beer to Illinois as a form of protest, effectively killing the sale.
The loss of Bell's in Illinois sheds light on the little-known details of "franchise rights" among liquor wholesalers. Thanks in large part to the lobbying efforts of the state's beer and spirits distributors, the distribution rights for beer brands are open-ended and weighted in favor of the distributors. By pulling his beers from Illinois in protest, Bell is hoping to shed some light on this, as craft brewers, in particular, often have to make these agreements in order to market their product. Before Goose Island entered their distribution deal with Anheuser Busch, they had similar problems with Union Beverage. There have been rumblings that Bell's can be gone from the market for a year, but the reality is, unless they come to an agreement with LaCrosse, LaCrosse sells his rights to a distributor that Bell respects, or Bell's sues to extricate themselves from their deal, they could be gone for much longer than that. It hurts Union more than it does Bell's; Chicago is Bell's fourth-largest market, but the brewery is extending its reach into other states and feel they can withstand the hit."
  • Hansen's option-granting practices reveiwed by SEC (from Motley Fool):
Hansen Natural finds itself in a precarious situation these days, despite having a lot going for it. The stock price is prone to 6% swings in either direction on the slightest bit of news, as nervous investors try to figure out what to do with the embattled market darling.
On the one hand, Hansen is undergoing one of those accounting reviews of options-granting practices dating as far back as 1996. Two weeks ago, a letter came in from the SEC, informing Hansen's management of an informal inquiry on the subject, and the company promptly set up its own internal investigation.

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