Message Font: Serif | Sans-Serif
 
UnThreaded | Threaded | Whole Thread (3) | Ignore Thread Prev | Next
Author: ungoy One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 11  
Subject: Sale of brewery business Date: 1/16/2000 12:08 PM
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Recommendations: 0
Please read the attached news release. So what is left of Genessee after the sale. A food business and a rental properties business. I have lost on them, and the stock has not budged since this announcement, so I have to figure out whether the company has any growth prospects in the foods business. Sounds to me like the Wehle's cashed out.

GENESEE CORPORATION ANNOUNCES AGREEMENT TO SELL GENESEE BREWING COMPANY

Source: PR Newswire
ROCHESTER, N.Y., Dec 16, 1999 /PRNewswire via COMTEX/ -- Genesee
Corporation (Nasdaq: GENBB) today announced that its Genesee Brewing
Company subsidiary has entered into an agreement to sell substantially
all of its assets to the owners of City Brewing Company. City Brewing,
a privately owned company that recently acquired the former Heileman
brewery in LaCrosse, Wisconsin, is part of Platinum Holdings, a New
York investment company.

Under the agreement announced today, City Brewing would acquire all of
the brands and operating assets of Genesee Brewing Company, including
Genesee's 3.3 million-barrel brewery located in Rochester, New York.
The new owner would continue brewing the Genesee and HighFalls brands
at the Rochester brewery. The parties anticipate that contract brewing
for Boston Beer Company will continue at the Rochester brewery after
the change of ownership. City Brewing is investigating the possibility
of adding ethanol production capability to the Rochester brewery.
Ethanol is a brewing by-product that can also be produced using corn or
other renewable resources as a raw material. The addition of ethanol
production would improve capacity utilization at the Rochester brewery.

Other terms of the deal, which is expected to close within ninety days,
were not disclosed.

Genesee, the nation's fifth largest brewer, produced 1.6 million
barrels of beer and ale and reported net revenues of $103.3 million in
its fiscal year ended May 1, 1999. Its brands include the Genesee line
of regional beers, such as Genesee Beer, Genny Light and Genny Cream
Ale, and a highly acclaimed line of specialty beers including JW
Dundee's Honey Brown Lager and Michael Shea's Irish Amber. Genesee
Brewing Company was established in 1878 and was one of the first
brewers in Upstate New York to resume production following the repeal
of Prohibition in 1933. Genesee survived the consolidation that has
occurred in the domestic brewing industry over the past thirty years to
become the nation's largest, independent regional brewer. Genesee has
450 employees and its products are sold in thirty-seven states.

"Speaking on behalf of my brother Ted and the rest of the Wehle family,
I can say that the decision to sell the brewery was emotionally a very
difficult one to make", said Chipp Wehle, President of Genesee Brewing
Company. "The Wehle family has been a part of Genesee and the Genesee
family for close to 70 years. Although we will miss being part of the
brewing business, we are pleased with the prospect that the brewery and
many of its employees will continue under new ownership, as will the
Genesee tradition of brewing the finest beer and ale," said Mr. Wehle.

Tom Hubbard, President and Chief Operating Officer of Genesee
Corporation said, "Genesee Brewing Company has enjoyed a long and
distinguished history under the leadership of the Wehle family. Genesee
has fought long and hard to be a strong, independent force in the
intensely competitive brewing industry and it is a tribute to our
employees, distributors and loyal consumers that Genesee remains as the
last large, independent regional brewer in the nation," said Mr.
Hubbard.

As previously disclosed, Genesee Corporation has been actively
reviewing strategic alternatives for its brewing business. "Of the
various strategic alternatives we have analyzed," said Mr. Hubbard, "we
believe the agreement with City Brewing offers the maximum value for
our shareowners and will provide the best opportunity for our
employees." Mr. Hubbard went on to say, "It should be recognized that
there are a number of contingencies associated with closing this
transaction and we will be working with City Brewing to expeditiously
address them. These include possible environmental issues and
renegotiating agreements with our six labor unions. We are encouraged
that this transaction can be the foundation for a bright and profitable
future for the Brewery."

City Brewing has held preliminary discussions with county and city
officials to explore economic development programs that will be needed
to encourage additional investment in the Rochester brewing facility.
City Brewing has also had preliminary meetings with leaders of the
unions representing brewery employees to discuss the terms of
collective bargaining agreements that it needs to negotiate prior to
closing.

John Mazzuto, President of City Brewing, voiced his support for the
transaction. "We were impressed with the quality of the Genesee Brands
and the local work force. We know that by partnering with our customers
and employees we can continue to build upon the proud Genesee
tradition."

"We are very excited about the future prospects for the Brewery," said
Jim Strupp, Chairman of City Brewing. "Genesee has an excellent
portfolio of regional and specialty brands, a well-maintained brewery
and a loyal and experienced work force. By Partnering with our
employees, we believe we can improve operating results for the Brewery
through incremental growth and production efficiencies. We look forward
to working with Genesee management and the labor unions to successfully
conclude the proposed transaction," said Mr. Strupp.

Copies of Genesee Corporation press releases are available free of
charge by calling PRNewswire's Company News On Call at 800-758-5804,
Extension 352775, or on the Internet at http://www.prnewswire.com/cnoc.

SOURCE Genesee Corporation
(C) 1999 PR Newswire. All rights reserved.
http://www.prnewswire.com
-0-
CONTACT: Mark W. Leunig, Director of Investor Relations of Genesee
Corporation, 716-263-9440
/Company News On-Call: http://www.prnewswire.com/comp/352775.html or fax,
800-758-5804, ext. 352775
(GENBB)


GEOGRAPHY: New York

INDUSTRY CODE: FOD

SUBJECT CODE: TNM
OTC

Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (3) | Ignore Thread Prev | Next

Announcements

What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and "#1 Media Company to Work For" (BusinessInsider 2011)! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement