The American beer industry welcomed bipartisan legislation introduced today to comprehensively reform the federal beer tax imposed on brewers and beer importers. The bill would remove barriers to growth in the industry, encouraging capital and workforce investment through simple, fair and broad reform.
Introduced by Reps. Steve Womack, R-Ark., and Ron Kind, D-Wis., the Fair Brewers Excise and Economic Relief Act of 2015 (Fair BEER Act) creates a graduated federal excise tax structure while maintaining a level playing field.
Under the Fair BEER Act, all brewers and beer importers would pay a rising scale of federal excise tax:
By imposing this “laddered” approach to all brewers and beer importers, the legislation reforms the overall tax structure to provide the greatest relief to the very smallest brewers. More than 90 percent of permitted brewers produce 7,143 barrels or less and would see their excise tax rates reduced from $7/barrel to zero. The 7,143 barrel threshold was designed to meet the definition of a “small brewer” set forth by the U.S. Department of Treasury’s Alcohol and Tobacco Tax and Trade Bureau (TTB), the agency which regulates the alcohol industry.
By applying comprehensive reform across brewers, the legislation removes barriers to growth. Under current law, small brewers are defined as those which produce up to 2 million barrels, and are taxed at $7/barrel on the first 60,000 barrels and $18 on every barrel thereafter. Current law imposes an $18/barrel federal beer tax on all suppliers of more than 2 million barrels annually.
“Our tax policies shouldn’t discourage the growth and continued success of an industry that supports jobs for more than two million Americans, and it shouldn’t pick the winners and losers in the market,” said Congressman Womack. “This comprehensive reform bill supports brewpubs, microbrewers, national craft brewers, major brewers, and importers alike and encourages their entrepreneurial spirit, which is exactly the spirit we need to get America’s economic engine going again.”
“The beer industry has shaped our heritage and history in Wisconsin, and plays a crucial role in our state’s economy,” said Congressman Kind. “Here in Wisconsin and across the nation, brewers are employing our workers and creating new jobs, and this pro-growth, bipartisan bill will help them continue to expand and produce high-quality products.”
“This bill is important for reforming a hidden tax that most beer drinkers don’t even know they pay, and because it removes barriers to industry growth,” said Jim McGreevy, President and CEO of the Beer Institute, the nation’s leading trade association representing brewers, beer importers and industry suppliers. “The Fair BEER Act deserves support, because it offers fair reform of the federal beer tax, but it reaches that reform without completely changing the industry structure.”
Other original Fair BEER Act co-sponsors include Mark Amodei, R-Nev.; Mike Bost, R-Ill.; Ken Buck, R-Colo.; Tony Cardenas, D-Calif.;Doug Collins, R-Ga.; Rick Crawford, R-Ark.; Danny Davis, D-Ill.; Sam Graves, R-Mo.; Raúl Grijalva, D-Ariz.; Alcee Hastings, D-Fla.;David Jolly, R-Fla.; Blaine Luetkemeyer, R-Mo.; Cynthia Lummis, R-Wyo.; Tom Marino, R-Pa.; Gwen Moore, D-Wis.; Grace Napolitano, D-Calif.; Jason Smith, R-Mo.; Todd Young, R-Ind.; Peter Welch, D-Vt.; Bruce Westerman, R-Ark.; and Ryan Zinke, R-Mont.
By offering tax reform across the category, from pennies on the barrel for major suppliers to an $18/barrel tax break for the smallest brewers, the Fair BEER Act offers Members of Congress an opportunity to support all brewers, from the smallest brewpubs to the biggest job creators. The Fair BEER Act also serves to fix a significant policy issue around trade by protecting small brewers from potentially losing their tax relief.
Companion legislation is expected to be introduced in the U.S. Senate shortly.
History of the Federal Excise Tax on Beer
Existing federal excise taxes on beer are set at a rate of $18/barrel for brewers of more than 2 million barrels (62 million gallons, or the equivalent of 110 million six-packs) and all beer importers. Since the late 70s, growth in the small brewing sector has been encouraged by tax credits offered to brewers which produce less than 2 million barrels, cutting their excise tax rate to $7/barrel on the first 60,000 barrels and allowing them a far lower overall effective tax rate on all barrels up to 2 million.
Today there are more than 3,300 breweries in the United States. More than 90 percent of those brewers produce fewer than 7,143 barrels annually, meeting the definition of a small brewer set by the Alcohol and Tobacco Tax and Trade Bureau (TTB). Many of those small brewers are brewpubs, which are restaurants with brewing operations designed to sell locally.
While the reduced tax rate for brewers has been a success in introducing new entrants to the market, the eligibility definition of “small” at 2 million barrels unintentionally created a barrier to further growth. By removing the production cap to allow all brewers and beer importers relief, and graduating the relief in such a manner that the deepest reductions in rates are reserved for the newest entrants to the market, the Fair BEER Act reforms the beer tax without altering the industry structure, or picking winners and losers in the marketplace.
Snyder’s-Lance, Inc. has set up a new snack food division called Clearview Foods™ to focus on developing innovative and better-for-you snacking options. Clearview Foods will concentrate its efforts on growing the Snack Factory® Pretzel Crisps®, Eat Smart™ and Late July® Organic Snacks products.
The company also introduced a new logo for the division inspired by Snyder’s-Lance’s strategy and corporate direction. The logo for Clearview Foods features clean and fresh primary colors, a visually striking icon and a recurrence of the corporate tagline, “Snacking is our passion™.” Together, the new logo, icon and tagline offer a clear perspective on the division’s mission to seek opportunities that capitalize on growth trends and extend into new food categories.
“With our new Clearview Foods Division, we are in a stronger position to satisfy our consumers’ desire for healthy snack choices that deliver on taste and quality,” said Carl E. Lee, Jr., President and CEO of Snyder’s-Lance, Inc. “Clearview is uniquely positioned to succeed by leveraging the company’s distribution network, R&D capabilities and manufacturing to drive growth. We are combining the entrepreneurial spirit of this Division with our corporate scale to better serve the expanding snacking needs of our consumers and retailers.”
The company has appointed Peter L. Michaud, former Vice President of Snack Factory, to the role of Senior Vice President and General Manager of the Clearview Foods Division.
“We all know that consumers are evolving the way they think about their snacking choices. Rather than shopping by a specific product category, they are seeking products that offer benefits aligned with their desire to eat healthier and adjust with their changing lifestyles. The future to us is all about better understanding these consumer behaviors and offering brands to satisfy them. We are also seeing a shift with our retail customers who have adjusted their shelf sets to offer healthier snacking options in locations across the store to cater to different lifestyle occasions,” said Michaud.
This new division is part of an overall transformation of the company, which started with the acquisition of Snack Factory Pretzel Crisps, and was followed by the divestiture of the Private Brands business, the acquisition of Baptista’s® Bakery and the acquisition of a majority stake in Late July Organic Snacks.
Nutiva®, the producer of award-winning organic superfoods, announced the introduction of CHIApple, a blend of organic fruit, spices and whole chia seeds. This delicious anytime energy boost is a great source of omega-3s and fiber. Unlike similar products, it contains no added sugars, fruit concentrates or artificial anything.
For on-the-go ease, CHIApple is available in a 3.5-ounce squeeze pouch (individually, MRSP $1.99; or in a 4-pack, MSRP $6.89), as well as a 24-ounce glass jar (MSRP $5.79). Each squeeze pouch contains 3 grams of fiber and 800+ mg of omega-3 fatty acids.
Available flavors include Pure Apple, Apple Pie Spice and Coconut Mango. In addition to on-the-go snacking for adults and kids, CHIApple is ideal as a smoothie boost or addition to oatmeal or yogurt.
“Chia has become extremely popular due to its high levels of antioxidants, omega-3s and fiber,” said Nutiva CEO and founder John W. Roulac. “With Nutiva’s CHIApple, consumers now have a delicious and simple way to enjoy the nutritional powers of chia anytime and anywhere.”
Once a vital source of nourishment for the ancient Aztecs and Mayans, chia seeds are making a strong comeback in modern healthy diets. Chia seeds are an excellent source of omega-3 fatty acids, protein, rare antioxidants, fiber and magnesium.
Nutiva CHIApple is available at Whole Foods Markets nationwide. All Nutiva products are certified organic and kosher and verified non-GMO.
For more information, please visit nutiva.com.
American Flatbread Pizza, producer of handmade wood-fired premium frozen pizza, is introducing three new pizza flavors to its premium line: Gluten-Free Cheese Trio & Tomato Sauce, Gluten-Free Pesto & Cheese and Fresh Basil Pesto & Feta.
The new American Flatbread frozen pizzas are made with specialty ingredients, many of which are locally sourced in New England where the company is based. Gluten-Free Cheese Trio & Tomato Sauce and Gluten-Free Pesto & Cheese are American Flatbread’s first gluten-free options within its line. Gluten-Free Cheese Trio & Tomato Sauce is a handmade flatbread topped with mozzarella, parmesan and Vermont Cookeville grana cheese, with homemade tomato sauce and fresh herbs. Gluten-Free Pesto & Cheese is also a handmade flatbread topped with savory pesto, made with fresh basil, toasted pine nuts, extra virgin olive oil, fresh minced garlic and parmesan. The third new flavor, Fresh Basil Pesto & Feta, is topped with savory pesto made with fresh basil, toasted pine nuts, extra-virgin olive oil, fresh minced garlic and feta.
“More and more Americans are maintaining a gluten-free diet, so it was important to meet their needs and develop these new recipes,” said CEO Brad Sterl. “As with all of our flatbread pizzas, we only use fresh, all-natural ingredients to ensure that our customers enjoy every last bite. We are dedicated to making pizza night a delicious and healthy experience for the whole family, and now they have even more choices.”
The Fresh Basil Pesto & Feta retails for $7.99 and the Gluten-Free Pesto & Cheese and Gluten-Free Cheese Trio & Tomato Sauce retail for $8.99.
American Flatbread frozen pizzas are topped with fresh herbs, vegetables and the finest of cheeses. They are all-natural, with no preservatives, artificial colors or flavors, and handcrafted from scratch and par-baked in wood-fired ovens.
For more information visit www.americanflatbreadproducts.com.
Bryan Mazur has joined Wixon, a manufacturer of dry mixes, seasonings, flavors and technologies for the food and beverage industry, as Key Account Manager for the company’s Consumer Products Division.
In this position, Mazur will lead business development in support of continued growth of the Consumer Products Division, with emphasis on contract manufacturing and direct selling. He will also collaborate with Wixon’s internal teams to coordinate product development activities, assist in driving operational efficiencies, and contribute to tactical and strategic planning for the Division. Mazur will report to Paul Whitaker, Wixon’s Consumer Products Divisional Leader.
Mazur most recently worked at Northern Labs in Manitowoc, Wisconsin, as Contract Manufacturing Sales Manager, as well as Business Development Associate for Regis Technologies, a provider of small molecule contract manufacturing services located in Morton Grove, Illinois. He earned a Bachelor of Science degree in biological and physical sciences from the University of Wisconsin – Madison.
A native of Chicago, Mazur resides in Sun Prairie, Wisconsin with his wife, and plans to relocate to Milwaukee.
For more information on Wixon and its products, visit wixon.com.
Three retailers, Vache Fermanian, co-owner, B&V Enterprises, Inc.; Rob McDougall, President and CEO, Gelson’s Markets and Greg Saar, President and Chief Executive Officer of Saar’s, Inc., were elected to Unified Grocers’ board of directors at a Feb. 4, 2015 board meeting.
“We are extremely pleased to have three very successful and talented retailers join our board,” said Richard E. Goodspeed, Chairman of the Board. “They bring many years of grocery industry experience and retail expertise to our board. Their wealth of knowledge gained from running stores of various formats and sizes will benefit the board and strengthen its overall composition.”
“We are pleased to welcome Vache, Rob and Greg to the Board of Directors,” said Bob Ling, President and Chief Executive Officer, Unified Grocers. “The quality and strength of their retail organizations reflect their leadership skills, and they will be strong representatives for all of Unified’s owners.”
Vache Fermanian is co-founder of Super King Markets, a family-owned chain of six Southern California grocery stores founded in 1993 in Anaheim. Over the years, Super King Markets have become recognized for their wide array of high quality international foods, low prices and excellent service.
Rob McDougall has been in the grocery industry for more than 40 years. He joined Gelson’s Markets in 2007 and assumed leadership of the company in January 2012. Gelson’s Markets is a chain of 18 Southern California supermarkets founded in 1951 that prides itself on quality and unmatched customer service.
Greg Saar owns eight supermarkets in the Puget Sound region operating under the Saar’s Market Place and Saar’s Super Saver Foods banners. Greg opened his first store in 1988 in Oak Harbor, Washington and has continued to grow the business with a focus on value and meeting the diverse needs of the communities surrounding his stores.
Rudy and Debbie Dory and their daughter Lauren Johnson, owners of Newport Avenue Market in Bend, Oregon, received the 2015 Ben Schwartz Retail Grocery Visionary Award from Unified Grocers at a special awards dinner last night in Los Angeles. This is the tenth year that Unified has presented the award to an outstanding independent retailer.
“It’s an honor to receive this prestigious award and I’m proud that Newport Avenue Market is the first single-store recipient,” said Rudy Dory.
In presenting the award, Bob Ling, President and Chief Executive Officer, Unified Grocers, said that Newport Avenue Market has thrived because it’s a reflection of the Dory family. “Rudy, Debbie and Lauren are committed not only to their customers and their staff but also to the local community and that’s reflected in their many successes over the years,” said Ling.
“Their passion to create a unique shopping experience is clearly evident as you walk through the store,” he added. “Innovation, quality and a friendly, knowledgeable staff are central to the success of Newport Avenue Market and that’s why customers come from near and far.”
The annual award is named after Ben Schwartz, a former Chairman of the Board of Unified Grocers. Schwartz was in attendance at the awards dinner.
The award is given to an independent retail grocer or grocery company that is a leader and innovator in the retail grocery industry. The award recognizes retailers who, by their practice and example, have consistently demonstrated initiative, creativity and leadership within their businesses and, in the process, have inspired others to think and act creatively and with passion in the grocery field. To be eligible, retailers must be, or have been, a member of Unified Grocers or one
of its predecessor companies.
“The award carries the name of a true retail visionary,” Ling explained. “The idea behind it is to recognize someone in our retail community who exemplifies the spirit and character Ben Schwartz demonstrated throughout his long career. We’re proud to give this award to the Dory family. Newport Avenue Market is a great store and the best is yet to come.”
In addition to the award that was presented to Newport Avenue Market, a duplicate is on permanent display in the lobby of Unified’s headquarters building in Commerce, California. A plaque recognizing Newport Avenue Market as the 2014 winner has been added to the permanent award.
Great Lakes Brewing Company (GLBC) launched its refreshed logo to the public in January and is now releasing new packaging artwork for the company’s five year-round brands.
The new label artwork was handcrafted by artist Darren Booth, who is known for creating detailed paintings with collage elements. GLBC provided Booth with archival materials relevant to each brand, that were incorporated into his paintings. These discoverable elements bring additional storytelling opportunities to each package.
Booth visited GLBC in the summer of 2014 to learn the history behind the existing labels. GLBC owners and team members briefed him on narratives for each brand and supplied unique collage pieces for Booth to include in his artwork. Throughout 2014, what began as sketched concepts evolved into colorful, detailed paintings, all of which incorporate textures and mementos from GLBC’s 27 years in the craft beer industry.
“Our customers may be familiar with Eliot Ness as a historical figure, but they may not know that our mother was his stenographer, or that he used to frequent our historic taproom. Darren’s beautiful paintings include so many layers that allow us to share these kinds of details. They’re more than just labels. They’re conversation pieces,” says GLBC co-owner Pat Conway, who, with brother and co-owner Dan Conway, is actively involved in the brand refresh process. On the bottom of GLBC’s new packages, customers will find similar stories that reveal the history behind each brew.
Booth was commissioned to create label artwork for GLBC’s five year-round beers and nine seasonals. The year-round packages will hit shelves beginning in May. In June, GLBC will release its first seasonal with refreshed packaging: Sharpshooter Session Wheat IPA. Brewed with orange peel and Jarrylo hops, Sharpshooter is a hoppy wheat beer named for Ohio-born exhibition shooter Annie Oakley.
Along with refreshed packaging, GLBC will release redesigned taphandles, signage, and merchandise around Memorial Day. A new company website will launch in May, along with the new Great Lakes Brewing Company Beer Symposium – a visitor’s center and event space.
Great Lakes® Brewing Company, which is comprised of a brewery and brewpub, was founded in 1988 by brothers Patrick and Daniel Conway as the first microbrewery in the state of Ohio and today remains Ohio’s most celebrated and award-winning brewer of lagers and ales.
For more information, visit greatlakesbrewing.com.
Frutarom Industries Ltd., a top producer of flavors and specialty fine ingredients, has acquired 100 percent of the share capital of FoodBlenders Ltd. for approximately US$ 2.4 million plus an additional sum expected to stand at about US$ 600,000, depending on the company’s performance. The transaction was completed upon signing and is being independently financed.
Established in 1998, FoodBlenders develops, manufactures, and markets savory solutions which mainly include spice and seasoning mixes, functional ingredients, marinades and sauces for the food industry, with particular emphasis on the convenience foods segment. In 2014, FoodBlenders posted sales of approximately US$ 3 million with profit margins similar to those of Frutarom in the same area of activity. FoodBlenders has a site in England where it develops, manufactures and markets its products which is located within close proximity of Frutarom’s Wellingborough site, and it has a wide customer base which includes British food and private label manufacturers.
FoodBlenders’ product line and technologies complement the product portfolios and activities of UK-based Savoury Flavours and EAFI which were acquired by Frutarom in 2012 and 2011 respectively and which also specialize in savory flavor solutions. The proximity to the Frutarom site at Wellingborough and the complementary line of products promise to generate synergies between FoodBlenders’ activity and Frutarom’s expanding savory activity in the UK and throughout the world.
Frutarom will strive to fully exploit the cross-selling opportunities inherent in the acquisition and expand the product portfolio for its existing customer base. Frutarom will also work towards achieving the utmost operational and business efficiencies possible from the merger of FoodBlenders’ activities with its own UK activities based on Frutarom’s existing infrastructure and through optimizing the use of its production facilities in this field.
Ori Yehudai, President and CEO of Frutarom Group, remarked: “This is an additional acquisition of activity in Frutarom’s core field of business that will enable us to offer our customers a broader set of solutions. This acquisition provides further reinforcement of our growing activity in the UK where Frutarom has a leading role in the field of flavors.”The global savory flavors market is growing as a result of the rising standard of living and way of life and the accompanying changes in consumer habits which are boosting demand for processed and convenience foods. Frutarom considers the field of savory flavors a vital strategic growth engine and invests heavily in developing unique innovative products with high added-value at its sites throughout the world. Acquiring FoodBlenders following the previous acquisitions in this segment is another step in establishing Frutarom’s leadership in this important area, and we intend to continue investing towards significantly expanding our savory activity in other countries around the world, including through further acquisitions.”
AB Acquisition LLC and Safeway Inc. have completed their proposed merger. Under the terms of the merger agreement first announced and unanimously approved by Safeway’s Board of Directors in March 2014, AB Acquisition LLC, the owner of Albertson’s LLC and New Albertson’s, Inc. (collectively “Albertsons”), will acquire all outstanding shares of Safeway. AB Acquisition is controlled by an investor group led byCerberus Capital Management, L.P., which also includes Kimco Realty Corporation, Klaff Realty LP, Lubert-Adler Partners LP, and Schottenstein Stores Corporation.
Safeway shareholders will receive $34.92 per share in cash, consisting of (i) $32.50 in initial cash consideration, (ii) $2.412 in consideration relating to the previously announced sale of the assets of Safeway’s real-estate development subsidiary Property Development Centers, LLC (“PDC”) and (iii) $0.008 in consideration relating to a dividend of approximately $2 million(after deduction for taxes at an assumed rate) that Safeway received in December 2014 on its 49 percent interest in Mexico-based food and general merchandise retailer Casa Ley, S.A. de C.V.(“Casa Ley”). In addition, shareholders will receive contingent value rights entitling them to pro rata proceeds relating to deferred consideration from the sale of PDC and any proceeds from the sale of Safeway’s 49 percent interest in Casa Ley.
Both contingent value rights will be non-transferable and non-tradable. For tax reporting purposes, Safeway intends to report that the fair market values of the contingent value rights at the time of the merger for PDC and Casa Ley are $0.0488 and $1.0149, respectively, per share, based on third party valuations.
With respect to PDC, both the initial cash distribution ($2.412 per share) and the total estimated asset value including the CVR ($2.461 per share) have increased slightly over the estimated values set forth in Safeway’s December 23, 2014 press release announcing the sale of PDC. Those earlier estimates were $2.38 per share and $2.45 per share, respectively.
In addition, in April 2014, Safeway stockholders received a distribution of stock in Safeway’s former Blackhawk Network Holdings, Inc. subsidiary valued at approximately $4.02 per Safeway share at the time of the distribution.
As a result of the completion of the merger transaction, the common stock of Safeway will no longer be listed for trading on the New York Stock Exchange or any other securities exchange.Safeway will file a Certification on Form 15 with the U.S. Securities and Exchange Commissionunder the Securities Exchange Act of 1934, as amended, to suspendSafeway’s reporting obligations under Sections 13(a) and 15(d) of the Exchange Act.
Merger Closing Paves Way for Enhanced Shopping Experience
“We plan to be the favorite local supermarket in every community we serve,” said Safeway President and Chief Executive Officer Robert Edwards, who becomes President and CEO of the newly combined company, effective immediately. “We will do this by knowing, listening to, and delighting our customers; providing the right products at a compelling value; and delivering a superior shopping experience. We will also continue to be active members of our local communities.”
As previously announced, current Albertsons Chief Executive Officer Bob Miller will become Executive Chairman. “This is a transformative day for both Albertsons and Safeway. This merger creates a unified, strong organization that is dedicated to bringing a better shopping experience to more customers across the country,” commented Miller. “Our combined geographic footprint, vast range of brands and products, and service-oriented staff will enable us to meet evolving shopping preferences.”
The merger will create a diversified network that includes 2,230 stores, 27 distribution facilities and 19 manufacturing plants with over 250,000 employees across 34 states and the District of Columbia. The new company will be comprised of three regions and 14 retail divisions, supported by corporate offices in Boise, Idaho, Pleasanton, California, and Phoenix, Arizona. Banners will include Safeway, Vons, Pavilions, Randalls, Tom Thumb, Carrs, Albertsons, ACME, Jewel-Osco, Lucky, Shaw’s,Star Market, Super Saver, United Supermarkets, Market Street and Amigos. In December, the companies announced the sale of 168 stores to four separate buyers, as divestitures required in order to secure U.S. Federal Trade Commission approval of the transaction.