NBWA Convention Primer: A Talk with Craig Purser

FILED OCTOBER 2, 2017

Dear Client:

Two weeks ago I got a chance to catch up with NBWA president and old friend Craig Purser at the Missouri and Kansas wholesaler association meeting in Branson, MO (Hurricane travel snafus prevented us from having our usual late night beer drinking session but we caught up over breakfast). You my friends, are a fly on the wall…

BBD: Wow, 80 years? You don't look a day over 76, Craig.

CP: Thanks, Harry…We're celebrating NBWA's milestone…not mine. We're also going to be talking about how the industry has faced many challenges over the past 80 years and how we are preparing for the next 80.

We thought we'd kick the 80th Annual Convention off, naturally, with a tip our hat to the 1980's with an 80's -themed Welcome Reception. It will be a good time for you to wear your Members Only jacket and those gigantic glasses you still wore when I met you in the 90s. We've got surprise appearances in store from some "famous figures" from the '80s, plus we'll dance (and maybe sing) to the tunes that some of us grew up on. All of this will be poolside at Caesars, over a cold beer, or three.

BBD: I'm actually a bit of an 80's aficionado….

CP: uh, yes. I think many of us recall your affinity for the Spasmatics (80s Tribute Band) in Austin. I believe you were asked to "leave the stage"

BBD: What are the main attractions this year - besides Vegas, of course?

CP: We've got an all-star line-up this year, and really do have all the bases covered. U.S. Labor Secretary Alexander Acosta will talk about jobs and the administration's priorities; Dana Perino from Fox News will walk us through all of the political and geopolitical happenings - including whether there will be progress on tax reform; we'll hear from two veteran brewery leaders, João Castro Neves, North America President and CEO of Anheuser-Busch and Ronald den Elzen, CEO of HEINEKEN USA, about what we all can do to improve the beer category; we'll hear from retailers and distributors as well and, wait for it…legendary sportscaster Brent Musburger will close out the convention.

BBD: You're kidding me. You got Brent Musburger? I thought that guy was dead?

CP: Nope alive and well and running a Vegas-based sports-odds website. He stepped out of the broadcast booth after this past college basketball season and man, does he have some great stories to tell.

[ED. NOTE: your publisher has been conducting a digital harassment campaign against Purser as many Next Gen beer distributors allegedly do not know who Musburger is.]

CP: The Trade Show floor will also be packed with over 250 companies featuring the latest and greatest products and services to help our guys take their businesses to the next level. The Trade Show has grown in size so much that we'll be using three ballrooms this year.

BBD: That's good to know. I'll be packing my comfortable boots and my white tennis shoes - so I can make my way around the entire Trade Show. I just hope my gout isn't acting up. Will I get to sample any beer?

CP: We might be able to find a case or two for you. Some 500 labels of beer will be on the Trade Show floor, representing the brands that distributors help build and showcasing the incredible choice and variety that distributors make available. I always encourage folks to try a beer they've never had before -- you just might like it!

BBD: What's new this year?

CP: A lot. We're really focusing on social media this year, and bringing NBWA's Convention and Trade Show to life on Facebook, Twitter and Instagram.

We'll have an Instagram booth set up so you and your friends can take a photo and immediately post it to Instagram. Don't forgot to tag us -- @FollowYourBeer and use #NBWAVegas. We'll also have a photo boot set up for Facebook and Twitter. Pop in there, pick your prop, say cheese, and then tell the world you're in Vegas on Facebook and Twitter.

This is also an exciting year for our Next Generation Group. We're thrilled so many younger generations are getting into the beer distribution business, and we've got some great seminars and events planned for them. One seminar is specially designed for the generations to attend together. So moms with daughters, dads with sons, heck, grandparents can come, too.

BBD: And how many folks are you expecting? I want to make sure I'm ahead of the crowd when it comes time to sample all those beers you mentioned.

CP: Good thinking. I know how you do everything at the last minute. We're closing in on 4,000 from all over the United States.

BBD: If we can hop on a plane, is there still time to register?

CP: Absolutely! See you in Vegas…

EVERCORE ISI: MOLSON COORS/BOSTON BEER: NOT GONNA HAPPEN; HEINEKEN/MOLSON COORS: MUCH MORE LIKELY

Last week we shared Credit Suisse's suggestion that Molson Coors may potentially acquire Boston Beer in the next year. But Evercore ISI analyst Robert Ottenstein tells BBD there's "no way" that's happening.

In his latest note, Robert says the takeover is "highly unlikely" for two reasons:

Molson Coors' current leverage (~5x) "is too high for a debt financed deal, and the firm has committed to maintaining its investment grade credit rating."
Plus, there's "no indication" that Jim Koch "is a seller now or in the future."

Robert does foresee a blockbuster deal with Molson Coors, however, in this scenario Molson Coors is the acquiree not the acquirer, with Heineken purchasing Molson Coors.

Robert acknowledged that Heineken has said they have "no interest" in macrobrewed beer in the U.S., but believes they're keeping their cards close to their chest here.

"Of course [Heineken is] saying that," Robert said, reminding how ABI "down played" their interest in Africa before MegaBrew, calling it a very fragmented country that only holds a few important markets.

Robert and company maintain that "the play for Heineken is to take the TAP brands global and that Coors Light, the Miller family and Blue Moon have significant global potential."

So what's Robert's timeline on this deal? Well, he thinks it becomes "more likely in 2019 or 2020," after Molson Coors completed the integration of MillerCoors and Heineken "improved its balance sheet." All in, they "ballpark 50% odds of acquisition by Heineken by the end of 2020."

BEER BRIEFS:

DON'T MISS THE BEER SUMMIT EARLY BIRD PRICE. The Early Bird price of $1200 expires this week for our 2018 Beer Summit at The Breakers in Palm Beach, Florida, January 14-15. Have you reserved your spot? 2017 was our largest Beer Summit to date so we're likely to sell out in 2018. Be sure to register today so you're not left out. Don't miss the chance to hear from some of the industry's most prominent voices. Call us at 210-805-8006 to reserve your spot now or visit us at http://www.beernet.com/beer_summit.php

Until tomorrow,

Harry, Jenn, and Jordan

"The trees that are slow to grow bear the best fruit."
- Moliere

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