USA: Pabst exercises option to buy brewery from Molson Coors

Pabst Brewing Company, a holding company headquartered in Los Angeles, California, has exercised an option to buy a brewery in Irwindale, California, from Molson Coors Beverage Company.

As previously disclosed, on January 6, 2020, Molson Coors Beverage Company USA and Molson Coors USA (formerly known as MillerCoors USA) each subsidiaries of Molson Coors Beverage Company entered into an option agreement with Pabst pursuant to which Molson Coors granted Pabst an option to purchase Molson Coors’s Irwindale, California brewery, including plant equipment and machinery and the underlying land (, 6.1.2020).

On May 4, 2020, Pabst exercised its option to purchase the Irwindale Brewery, and such purchase is expected to close in the fourth quarter of 2020, subject to the satisfaction of certain customary closing conditions.

Pabst did not own an own major production since it closed down its production in Milwaukee in 1996 after 152 years. Since then Pabst’s legacy brands like Pabst Blue Ribbon (PBR)Old Milwaukee, Lone Star, RainierStroh’s, Old Style and Schlitz were brewed under contract by third parties including MillerCoors.

In September 2015 MillerCoors closed its Eden, N.C., brewery where Pabst had some of its beers brewed under a contract brewing agreement. As a consequence of the plant closure and disputes about the future of Pabst and MillerCoors' distribution partnership, Pabst sued MillerCoors for USD 400 million claiming a contract breach. Pabst argued that it would not be easy  to find or build new brewing capacities considering the high volumes of the Pabst brands, should MillerCoors not extend the contract past 2020 (, 17.6.2018).

In 2017, Pabst opened a craft brewery on the former Pabst complex just west of downtown Milwaukee. The new so called Pabst Milwaukee Brewery was located in what was Milwaukee's first German Methodist church, built in 1874 and sold to Pabst in 1898. In January 2020, with the release of Pabst Brewing Co.'s new craft beer line, Captain Pabst, the local taproom was rebranded as the Captain Pabst Pilot House. The taproom, which operates a 10-barrel brew system and produces about 600 barrels a year, brews beer for the upstairs taproom as well as acts as a pilot brewery for Pabst.

In 2019, Pabst finally announced a new 20-year contract brewing agreement until 2040 with City Brewing Company in La Crosse, Wisconsin which was scheduled to start after expiration of the old contract brewing agreement with Molson Coors after 2020 (, 11.11.2019).

It’s not clear, if this contract will still be executed after Pabst has now its own production site. In 2018, Pabst had sales of about 5 million barrels of beer which is about the capacity of the Irwindale brewery. In 1892 Pabst was the largest brewer of lager in the world. That record was exchanged between Pabst, Anheuser-Busch, and Schlitz in following years.

The Irwindale brewery, which opened in 1980, was Molson Coor’s lowest-volume brewery in the United States. In 2019 the plant produced 4.8 million barrels (5.6 million hl) and shipped products to 261 distributors. Brands brewed at the facility included Coors Light, Miller Lite, Miller High Life, MGD, Steel Reserve, Miller64 and several brands for Pabst.

After the decision to close or sell the brewery in January, Molson Coors already started to transfer production of its own brands to its other facilities.

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