Under Review: The Hand Family Purchase of City Beverage

Members of the Illinois Liquor Control Commission are set to review the proposed buyout of distributor City Beverage by a Tennessee Family at the commission’s monthly meeting in Chicago this afternoon.

If you recall, Anheuser-Busch announced on October 31st that they were selling their 30-percent stake in the four wholesalers that make up City Beverage (Arlington Heights, Chicago, Markham and downstate Bloomington) to the Hand Family. Also announced, on the same day, the investment firm that owns the remaining 70-percent interest in City Beverage would be buying River North Sales and Service.

The plan: roll the two into one creating the largest Bud distributor in Illinois.

Moving forward, the mega distributor will be known as Lakeshore Beverage.

photo courtesy @chicagobars

photo courtesy @chicagobars

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The Legal Battle Over IL Distributor City Beverage Finally Comes To A Close

With a few flicks of a pen today, Illinois Governor Pat Quinn signed HB 2606 into law effectively ending Anheuser-Busch’s minority ownership — and majority control — over distributor City Beverage.

The legislation, approved overwhelmingly by the Illinois House and Senate during the spring legislative session, would prohibit a brewer from owning a distributor.

Introduced in February, the bill specifically targeted Anheuser-Busch’s 30-percent stake in wholesaler City Beverage, which has four locations in Illinois; Arlington Heights, Bloomington, Chicago and Markham. The distributorship was seen as a pivotal piece in A-B’s attempt to chip away at MillerCoors’ stronghold on the Chicago market. Continue reading

Bill Prohibiting A Brewer From Owning A Distributor Passes IL Senate, Headed To Gov’s Desk

Legislation that would make it illegal for a brewer to hold an ownership interest in an Illinois distributor cleared the state Senate Tuesday on a unanimous, 52-0 vote. The bill previously passed the House and now goes to the governor for his signature.ilcapitol

Once signed into law, the bill will effectively end Anheuser-Busch’s minority ownership interest in, but majority control of, Illinois distributor City Beverage. Continue reading

Anheuser-Busch Agrees To Relinquish Ownership Interest In IL Distributor City Beverage

abdiThe Associated Beer Distributors of Illinois, the engine driving legislation to clear up Illinois’ 3-tier system of alcoholic beverage distribution, says the proposal currently before the Illinois House has an unencumbered path to passage.

This is significant because the legislation, if it becomes law, would require Anheuser-Busch InBev to divest its minority interest in Illinois distributor City Beverage.

The bill in question specifically prohibits a brewer from owning a distributor.

AB InBev has fought for years to retain its ownership interest in City Beverage, which is held through a wholly owned subsidiary, and ultimately won a drawn out battle before the Illinois Liquor Control Commission last fall. The Commission noted, in its decision, that the Illinois Liquor Control Act was too vague in terms of who can and who cannot own a distributor in Illinois and challenged the Illinois legislature to address the issue directly.

HB 2606 is in response to that challenge. Continue reading

Legislation To Strip ABI Of Its Stake In IL Distributor City Beverage Is Picking Up Steam

CITY BEV beverage_chicagoProposed legislation that could ultimately force Anheuser-Busch to divest its ownership interest in Illinois distributor City Beverage is gaining momentum in Springfield.

Mirroring pieces of legislation in the Illinois House and Senate were approved, unanimously, in committee prior to lawmakers departing for a two-week spring break.

Legislators return to the capitol this week.

The legislation appears to clearly define who can and who cannot hold an interest in an Illinois distributor, according to a synopsis of the bill posted to the Illinois General Assembly’s website.

“Provides that no person licensed as a manufacturer of beer by any licensing authority, or any partnership, corporation, subsidiary, limited liability company, trust, agent, affiliate, or other form of business enterprise thereof, shall have any interest, directly or indirectly, in a holder of a distributor’s license or importing distributor’s license,” according to the synopsis.

The legislation also lays out a step-by-step process to revoke the licenses of manufacturers found in violation of proposed law.

The bills, SB 1855 in the Senate and HB 2606 in the House, were introduced in response to a Halloween day ruling by the Illinois Liquor Control Commission allowing ABI to maintain its minority ownership interest in the four City Beverage distributors through a wholly owned subsidiary, Wholesaler Equity Development Corporation, or WEDCO. Continue reading

The Illinois Legislature Is Taking Aim At Anhueser-Busch, WEDCO & City Beverage – UPDATED

citybeveragegi***UPDATE***

A companion bill has been filed in the Illinois House, mirroring the legislation introduced a week-and-a-half ago in the Illinois Senate.

State Representative Frank Mautino (D-Spring Valley), who sponsored the “Craft Brewer Act” in 2011, is the lead sponsor of HB 2606. Mautino is joined by nearly 40 co-sponsors – and counting

Neither bill has been assigned to a committee.

***END UPDATE***

A group of lawmakers in the Illinois Senate are responding to the Halloween day ruling by the Illinois Liquor Control Commission allowing Anheuser-Busch, through a wholly owned subsidiary, to retain an interest in an Illinois distributor.

The surprise ruling, ending a years-long dispute over whether a brewer can own an interest in a distributor in Illinois, caused an uproar amongst distributor groups in Illinois who felt the Commission ignored the legislative intent of a bill that become law in 2011.

You can catch up on our past coverage HERE. Continue reading