Archive

ShareThis Page
Rivertowne Brewing up for bankruptcy sale | TribLIVE.com
Westmoreland

Rivertowne Brewing up for bankruptcy sale

Tribune-Review
| Thursday, September 27, 2018 12:06 p.m.
275077RivertowneMain
Steph Chambers | Tribune-Review
Rivertowne Brewery in Export

Rivertowne Brewery and Tasting Room, a craft brewery in Export, and its four associated restaurants in Allegheny and Westmoreland counties is expecting interest from at least six potential buyers when it goes up for sale next month, according to filings in U.S. Bankruptcy Court in Pittsburgh.

About 240 other potential buyers, many with experience in the food and beverage industry, have been notified of the pending sale, according to filings in Rivertowne’s bankruptcy case.

Bidders have until 5 p.m. Oct. 10 to submit offers, which will be reviewed to determine who is qualified to make the purchase, said Daniel Schimizzi, a Pittsburgh attorney representing Rivertowne in the Chapter 11 bankruptcy case filed in May. The brewery and restaurants in North Huntingdon, Monroeville, Verona and on Pittsburgh’s North Shore can be sold separately or in a package deal, Schimizzi said.

Bidding for the brewery will start at $1.35 million, which is the amount submitted by Gordon Brothers Commercial & Industrial LLC of Boston. As of now, Gordon Brothers, an advisory, lending and investment firm, bid only for the brewery, other unidentified assets and possible liabilities such as contracts and leases.

A closed-door auction for qualified bidders will be held Oct. 12, and an open hearing in bankruptcy court is planned for Oct. 16, Schimizzi said.

Cal Shusta, a spokesman for Gordon Brothers, couldn’t be reached for comment. Christian Fyke of Monroeville, who founded Rivertowne in 2007, could not be reached for comment.

If Gordon Brothers does not want the restaurants, Rivertowne wants the authority to sell those properties, which would offer the best chance for workers to continue to have a job, court documents stated.

Rivertowne has about 150 employees. It continues to operate while protected from its creditors. Debtors are owed between $1 million and $10 million. They include the Pittsburgh Pirates, who were owed $271,000; the Pittsburgh Penguins, owed $125,000; and S&T Bank of Indiana, which was owed $103,380, according to court filings.

The businesses are owned under the names of Fybowin LLC and three interlocking companies. Fyke owns almost half of Fybo Management Inc., and has stakes in Rivertowne North Shore, Monroeville Pour House and Brewery, Rivertowne Pub and Grille in North Huntingdon and Rivertowne Inn in Verona.

Stiff competition

Rivertowne became a victim of increased competition in the beer business, which cut its market share, the company stated in court documents. It tried to generate more revenue beginning April 2017 by brewing new craft beers, conducting a marketing blitz to attract new customers and partnering with local establishments to create customized beers. Those efforts failed to generate enough money to stave off bankruptcy, and sales have not grown enough to fund a reorganization plan to allow it to emerge from bankruptcy and remain open.

Competition among restaurants and brewpubs is strong in Western Pennsylvania, and there is a shake-up in the craft beer industry nationwide, said Sean Casey, who has operated the popular Church Brew Works in Lawrenceville since 1996.

Brewpubs that offer customers their own custom beer are competing not only with other brewpubs, but other restaurants. There are about 30 breweries in the region competing for patrons, Casey said.

“There’s more tap rooms opening up with a food truck,” Casey said. “There’s so much saturation” in the market.

The Brewers Association of Boulder, Colo., said craft brewery sales continued to grow in 2017 at a rate of 5 percent by volume. Craft beer has captured 12.7 percent of the U.S. beer market by volume, and craft beer production grew the most for microbreweries.

Pennsylvania ranked first in barrels of craft beer produced last year — 3.7 million — from 282 craft breweries statewide, according to the Brewers Association, a trade group for small and independent breweries. The state has nearly three craft breweries for every 100,000 adults of legal drinking age.

While craft beers are localized, Casey said national beer producers are buying regional craft breweries. That puts the local breweries, with less resources, at an unfair advantage in terms of marketing and production, he said.

“It’s pretty hard for Rivertowne to compete against Bud,” Casey said, referring to Belgium-based beverage giant Anheuser-Busch InBev. The company may brew its craft beer at the same brewery where it makes national products, Casey said.

“The big boys keep gaining,” Casey said. Their strategy seems to be “if they can’t beat ’em, let’s buy them.”

Joe Napsha is a Tribune-Review staff writer. You can contact Joe at 724-836-5252 or jnapsha@tribweb.com.

TribLIVE commenting policy

You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.

We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.

While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.

We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers

We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.

We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.

We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.

We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.