News broke shortly before 11am this morning that brewing giant Lion had reached an agreement with beloved Dunedin craft brewer Emerson’s Brewing Company to acquire 100% of the company’s shares, effective 30 November 2012. Emerson’s described the move as “an exciting new chapter” in their 20 year history while Lion made the right noises saying “Emerson’s will remain as a standalone business unit within Lion and will continue to produce the same great beers from the same Dunedin brewery with the same great people.”
Clearly anticipating drinkers’ concerns, the press release stressed that “[founder] Richard Emerson, General Manager Bob King and Brewing Manager Chris O’Leary will retain the day to day running of the Emerson’s operations and all other roles within the Emerson’s business will remain unchanged.”
Richard himself is quoted as saying “It is business as usual for Emerson’s – the taste, integrity to style, quality and consistency of our beers will remain the same. Lion’s ownership allows us to continue doing what we do well – experimenting and brewing great beer. We will now have the backing to help us to realise our growth aspirations. This is a very exciting opportunity for Emerson’s and the team and we remain committed to Dunedin and maintaining the brand’s distinctive character and authenticity.”
So, on the face of it, the move could be a win-win scenario. The same people will make the same beers in the same place – they simply will soon have move money, marketing and logistical support behind them. It will presumably also allow Emerson’s access to bars and restaurants which are tied to Lion – venues previously closed to them – as well as greater export potential.
However, the immediate reaction online has been decidedly mixed.
In the first hour after the announcement, typical comments on my social mediaranged from “good business deal – I hope the beers stay as good” to “I hope Richard is now a very rich man – he deserves it” to “I’m not sure what to think of that” to “Nooooooooooooooo” (that was a common one) to “I haven’t yet found the expletive that sums up my feelings” right up to “sold his soul to the devil – the boycott beers list just got bigger.”
If anything, the response on the Emerson’s Facebook page was even more negative than on mine.
I will admit the announcement took me by surprise. In a recent issue of Beer & Brewer I concluded that “The craft breweries producing enough beer to make them a takeover target – places like Emerson’s, Tuatara, Three Boys, Harrington’s, Steam and Renaissance – seem determined to remain independent.” Less than six months later, I am proved wrong.
Here is my initial take on the agreement:
If the Emerson’s staff retains creative and recipe control of their beers and Lion does stick to promotion and distribution, then we could see the creation of the first genuinely national modern craft brewery. The key word there is “if”.
A number of seasoned drinkers are reminded that a similar business model was mooted for Mac’s and it gradually became integrated into Lion, the regional breweries (Nelson and Wellington) were closed and production was centralised. That is how most similar arrangements seem to have worked out in Britain, Australia and America too. For those reasons, many Emerson’s fans (and there are a lot of them) are genuinely worried about the brewery’s medium-term future.
And I just have to note that it is slightly disconcerting to see Richard using the word “brand” in the press release because he normally just talks about beer.
I wish Emerson’s the absolute best in their “new challenge”. They are one of the best breweries in the country, some of the best people in the business and this is the path they have chosen.