Sleeman's to close Dartmouth brwery

[bluenose]

http://www.newswire.ca/en/story/1124817 ... -in-canada

Sapporo Optimizing North American Production to Enable Growth in Canada
Company actively seeking buyer for its Dartmouth facility

GUELPH, ON, March 6, 2013 /CNW/ - Sapporo International, the parent company of Sleeman Breweries Ltd., announced today its intent to sell its Dartmouth, N.S. brewing facility. As part of the strategy to meet growing demand for Sleeman and Sapporo in Canada and the U.S. in the short-term while also enhancing overall productivity across its North American operations, Sapporo International will also shift 200,000 hectolitres (hL) of Sapporo products, bound for export to the U.S., from its Guelph, ON facility to a third party brewing partner in the United States effective June 2013.

"Sapporo has been increasing its North American market share in a category that is experiencing only modest growth. In order to consolidate and maximize this momentum, we must make some immediate and crucial changes to our North American brewing strategy to improve productivity across our entire operation," says Shige Yokoi, President and CEO, Sleeman Breweries Ltd.

"The impetus behind our intent to sell the Dartmouth facility, which produces less than two per cent of annual volume, is to establish the long-term competitive resilience we need in an aggressive market by taking advantage of the economies of scale our North American operations offer," Yokoi adds.

To this end, Sleeman has already engaged some prospective buyers who have indicated a desire to keep the facility as a brewery, including keeping some or all of the 32 affected employees. However, should an appropriate buyer not be identified by July 2013, the company will make the difficult decision to close the facility.

"Please let me emphasize my appreciation for the hard work and contributions our employees have put into Sleeman at every level," says Yokoi. "I know this decision creates a lot of concern and anxiety among our 32 Dartmouth staff in particular. By actively advancing a sale now, we very much hope to secure the jobs and viability of this brewery. But in the long-term interests of our North American operations, we felt we needed to achieve some efficiencies of scale right away to stay competitive against our much larger continental and global rivals."

Sleeman Breweries currently produces more than 1.8 million hL of volume a year at facilities across Canada, including 27,000 hL at Dartmouth. By shifting 200,000 hl of Sapporo (which has been exported to the U.S. since 2002) from Guelph to the U.S., including the Sapporo kegs, the Sapporo Premium 20.3oz bottle, 16oz bottle, 12oz bottle and 12oz can and Sapporo Premium Light 12oz bottle, the company will be able to deliver on consumer demand in a more productive manner by the end of Q2 2013. Guelph will continue to produce all Sapporo products for Canada and the Premium 22oz can and the Sapporo Reserve 22oz can and 12oz bottle for both the U.S. and Canadian markets.

"We have to act now in order to capitalize on our competitive momentum and the efficiencies and production benefits our integrated North American operations offer will help us advance this goal, including the long-term productivity of our facilities in Chambly, Quebec, Guelph, Ontario and Vernon, British Columbia," says Yokoi.

About Sleeman Breweries Limited
Sleeman Breweries Ltd. is the third largest brewing company nation-wide. The company has supplemented its core Sleeman brands, which are available in every province, with a family of exceptional regional brands. These include Okanagan Spring in British Columbia and Unibroue in Quebec. Sleeman entered the rapidly growing value price category in 1999 by acquiring the Stroh portfolio brands in Canada, including Old Milwaukee and Pabst Blue Ribbon. In 2006, Sleeman Breweries Limited was acquired by Sapporo Holdings Limited of Japan. The company markets and/or distributes world class imported products such as Guinness, Sol, Dos Equis and Tecate and is supported by 1,000 employees.

About Sapporo Holdings Limited
Sapporo Holdings Limited is a Japanese holding company with an enterprise value of C$4.0 billion that is active in five business segments and includes Sapporo International as its overseas business segment. Its Alcohol segment is engaged in the manufacture and sale of beer, RTD, sparkling liquor, wine, shochu, liquor and others. The company manufactures alcohol products including Sapporo Draft Beer, Yebisu Beer and Mugi & Hop. The company also distributes Yellow Tail and Beringer in Japan. The Food & Beverage segment manufactures and sells beverages, such as tea, mineral water, coffee, carbonated drinks, fruit juice, health drinks, sports drinks and others as well as foods, such as, soup, lemon seasoning and others. It distributes Ocean Spray Cranberry in Japan. Its Restaurant segment is involved in the operation of beer parlors and restaurants under the store name Ginza Lion. The Real Estate segment is engaged in the operation and management of complex facilities that contains offices, housing, restaurants, and commercial and cultural facilities under the name Yebisu Garden Place, in addition to commercial and amusement complex facilities.

SOURCE: SLEEMAN BREWERIES LTD.

For further information:
Contact:
Stéphane Duval, Vice President, Marketing, Sleeman Breweries Ltd. sduval@sleeman.ca / 514-702-1730

[mr x]

wow.

[Graham.C]

Wow indeed. I wonder who the prospective buyers are.

[BobbyOK]

Worst part of this is the likelihood they'll stop selling Unibroue stuff there.

Upside - who wants to start a brewery with 27,000+ hL capacity?

[mr x]

Harold MacKay.

[CorneliusAlphonse]

The facility propeller has stated they're getting is directly across the street...

[Beerthief]

I can't see it affecting Unibroue availability?

[akr71]

I can't see it affecting Unibroue availability?

Sleeman's owns Unibroue & sold Unibroue products directly from the Dartmouth brewery.

[mr x]

http://thechronicleherald.ca/business/9 ... union-boss" onclick="window.open(this.href);return false;
Sleeman will see sales sag — ex-union boss

Sleeman Breweries Ltd. sales will go flat in Nova Scotia after the parent company closes or sells its Dartmouth plant, the former boss of the province’s largest brewery workers union said Tuesday.

Gary Foran, who was the longtime president of Local 361 of the Brewery and Soft Drink Workers union in Halifax and is a former Oland Brewery employee, came temporarily out of retirement to berate Sleeman Breweries for pulling out of the province and putting 32 people out of work.

“Surely, the people at Sleeman Breweries do not believe it will be business as usual in this province after they close or sell that plant.”

Besides the added trucking costs and negative publicity, the Guelph, Ont., brewer will face increased costs in Nova Scotia as a result of its lost status as a local brewer, Foran said in an interview.

“They will have to pay service fees to the province that local brewers do not pay.”

Rules for interprovincial trade in beer are complicated and in place across Canada, he said. They are designed to protect local jobs, he said.

Sleeman has not revealed exactly how much of the estimated 27,000 hectolitres of beer produced annually at the Dartmouth plant is sold in Nova Scotia.

Beer from the plant, which can produce 60,000 hectolitres per year, is sold throughout the Maritimes and in parts of Quebec and Ontario, the company said.

“There are about 25 dozen bottles of beer in a hectolitre, so according to their numbers, that plant is producing about eight million bottles of beer per year,” Foran said.

He said this is a comparatively small production capacity by current brewery standards. The Oland Brewery plant in Halifax can, by comparison, produce about eight million bottles of beer in a week.

Fans of locally produced brews are unlikely to appreciate any hint of a price increase from Sleeman to Nova Scotia consumers, Foran said.

Importers pay a minimum $1.32 service fee to the Nova Scotia Liquor Corp. for each case of 12 beer, said corporation spokesman Greg Beaulieu.

“Local brewers handle their own storage and distribution costs, while these services are provided to importers by the corporation.”

Some beer importers choose to absorb part or all of the additional cost for marketing reasons, Beaulieu said.

The corporation’s service-fee policy flows down from the province’s Liquor Control Act, he said.

Officials with Sleeman in Guelph were not immediately available for an update on the sale of the plant or for a discussion about future pricing in Nova Scotia.

Sapporo International of Japan owns Sleeman. The Dartmouth plant is for sale and is set to close in July.

[BobbyOK]

Rules for interprovincial trade in beer are complicated and in place across Canada, he said. They are designed to protect local jobs, he said.

Ha! That's a good one. Said almost like he believes it's actually true.

Any more word on potential buyers?

[mr x]

Haven't heard a thing.

[spears104]

Crappy situation for the workers there. Been there, done that.

I'm not in the know about HRM stuff but I have heard that both Garrison and Propeller have started their expansions elsewhere. Who else could take this place over?

[Keggermeister]

http://thechronicleherald.ca/business/1 ... on-to-beer

Maybe Jost?

[jherbin]

Who's going to start the Kick Starter campaign to buy this place up? Added bonus of neighbourly competition with the new darkside propeller brewery!