I just finished off a bottle of the tremendously tasty Big Hoppy Monster from the Terrapin Beer Company.

It is the last Terrapin beer I will ever drink.

On Wednesday, the brewery’s founders sent an e-mail to their employees explaining that they were converting debt from Tenth and Blake, a subsidiary of MillerCoors, into a minority stake in the company. In a nutshell, that means that MillerCoors now owns a part of Terrapin. If this strikes you as eerily similar to the Goose Island situation, well…I agree with you.

When I moved to Alabama in 2007, Terrapin quickly became my favorite Southern brewery. Actually, it became one of my favorite breweries period. With excellent year-round offerings like their flagship Rye, Hopsecutioner IPA and Hop Karma India Brown Ale, Terrapin was a session-lovers dream. They also offered some crazy-delicious, high-gravity seasonal brews like their Big Hoppy Monster, Rye Squared, and outstanding Wake ‘n’ Bake (a Coffee Oatmeal Imperial Stout). Whenever a new Terrapin offering hit the shelves, Brother Barley was there to snatch it up.

Last year, Spike and John, the Terrapin founders, found themselves at odds with their investors. They disagreed as to what the direction of the brewery should be, so Spike and John looked for another option that would allow them to wrest control of their company back from the money-men. In stepped Tenth and Blake, the so-called “craft” division of MillerCoors. They offered Terrapin thirty pieces of silver…and Spike and John never looked back.

If you’ve read any interviews with Tom Long, the CEO of MillerCoors, you’ll know that he sees craft beer as a huge potential revenue stream for his company. Like AB InBev, Long wants to sink his company’s fangs into some of the more successful craft breweries in the market so he can ride the coat-tails of craft’s unstoppable rise. MillerCoors has seen incredible success with pseudo-craft beers like Blue Moon and Leinenkugel, but they know that true Aleheads shy away from these macros in craft’s clothing. To really take advantage of the market, Long has decided to prey on reputable brewers.

Last year, MillerCoors spun off Tenth and Blake. The division handles Blue Moon, Leinenkugel, and now Terrapin. The innocent-sounding sobriquet is a pathetic attempt to keep the stigma of the MillerCoors name away from any craft breweries they get involved with. Some Aleheads were concerned when Tenth and Blake offered cash to Terrapin to allow Spike and John to take back control of their company. Me? I played the fool and noted that as long as it was just a cash/debt deal, there really wasn’t a problem.

I was an idiot.

Truth be told, I stand by my original premise. If the deal had stayed as it was, then Tenth and Blake (aka MillerCoors) didn’t own any of Terrapin (just as a bank doesn’t own your house as long as you keep paying your mortgage). I argued as such with loyal reader Danner who pointed out my hypocrisy when I mocked other breweries that had the stink of Big Beer on them. At the time, I honestly believed I was right. But now? Danner’s looking a lot smarter than me.

I honestly thought Spike and John were better than this. I thought they’d see what happened when InBev bought a piece of Goose Island and then eventually…inevitably…snapped up the entire company. Now, when you buy a Terrapin product, you’re supporting MillerCoors. When you buy a Hopsecutioner or Moo-Hoo, you’re filling the coffers of a company that doesn’t give a damn about the growth of the craft industry (actually, they’ve been trying to destroy the industry in a variety of ways) . Tom Long may say he wants to grow his company’s craft portfolio, but trust me…he’d like nothing more than for craft beer to go away entirely. As long as small, independent breweries keep gaining market share, MillerCoors is taking a hit.

This is a sad, sad day for Aleheads everywhere and the McHops household in particular. I truly loved Terrapin and its offerings. You can argue that if they continue to make  consistent, quality brews, that it shouldn’t matter. But it DOES matter. There are other ways to grow a company. You don’t have to sell out to the enemy just because you need a quick cash infusion. We’ve known for awhile now that some craft breweries were going to take the bait and sell their souls for a huge payday from Big Beer. I just never thought Terrapin would be one of the first to go.

I enjoyed my Big Hoppy Monster tonight. I really did. I’m sad it’s the last I’ll ever have.

Farewell, Terrapin. When MillerCoors buys you up entirely, I won’t shed a tear. You’ve made your bed…

Good luck sleeping tonight.

20 thoughts on “ET TU, TERRAPIN?

  1. Wow. With a couple of cases of various Terrapin brews including verticals from 2007 of Big Hoppy and Wake n’ Bake in my basement, I’m really struggling here. We don’t know the details of the finances of Terrapin (and may never), but it’s hard for me to believe that John & Spike couldn’t have raised any amount of cash from local turtleheads with no expectation of input into the running of the brewery. Perhaps Tenth and Blake will likewise have no say in the running of the brewery, but that would surprise me greatly.

    I can’t quite muster the level of vitriol you expressed, but I am terribly saddened. It’s not that the quality of their beers will change any, but rather as you put it, every beer they sell will put money in the pocket of avowed enemies of craft brewing and brewers. This was the case though as soon as they took any financing from MillerCoors, so just now getting our shorts in a wad is a tad hypocritical. I will though probably not be purchasing any more Terrapin brews. There’s just too many good beers out there that aren’t also funding the folks who lobby for restrictive laws that just benefit their distribution channel. A sad day for the craft beer world.

  2. i immediately thought of you when i saw the news on ba. my heart sank when i read the title of the thread. i feel betrayed. big hoppy monster was the first beer i bought on my first atlanta beer run in 2007. i drank a wake n bake to celebrate alabama’s rose bowl win two years ago. iba was one of my first loves on j clyde’s $2 pint night (speaking of things that used to be awesome…). i have consumed countless bottles of rye pale ale and hopsecutioner. all those great beer memories feel very distant right now. i can’t say that i will never buy another terrapin product (i love the hoppy monster so much), but i can say that they will see far fewer of my dollars. this sucks.

  3. What a shame. I really enjoyed trying those Terrapins when I came to visit you last year, and had always liked your commentary about them. I’m glad that there are plenty of other good craft beers around to drink, but this is a loss for sure.

  4. BeerBanker, you’re right about the hypocrisy. I think as craft beer fans, we have to draw the line somewhere. With Terrapin, I was willing to give them the benefit of the doubt when it was just a debt deal…but now that an ownership stake is involved, I’m not. Would I have felt the same about a brewery that wasn’t one of my regional favorites? Probably not. So yes, that’s pretty hypocritical. I just really didn’t want Terrapin to be one of the first sell-outs in the industry so I rather willfully turned a blind eye to the original Tenth and Blake deal…

    Also, I love some of the language in the press release. It reads EXACTLY like the Goose Island press releases when InBev bought them out. Do you think Spike and John have EVER used the word “synergies” before? That’s actually a bit of corporate-speak you’ll see often on the Tenth and Blake website. And all the language about how “nothing will change” and how Tenth and Blake really “believes” in Terrapin? Utter horseshit. Like Goose Island, they’re painting this as a necessary deal because they just couldn’t make enough beer for their fans. As we’ve pointed out many, MANY times on this site, there are hundreds of breweries that are figuring out ways to expand without selling out to the likes of AB InBev or MillerCoors. I simply can’t believe that Terrapin couldn’t have found a way to do so as well.

    So sad.

  5. If Terrapin’s beer stays EXACTLY the same, you’re saying you won’t drink it just because of who owns them? I agree that MillerCoors would prefer the craft segment to disappear, but I think true lovers of beer focus more on the product inside the bottle than who’s funding its creation.

    The Goose Island situation worried lots of beer geeks, but have we seen any reduction in quality? Until these acquisitions of craft breweries lead to a dip in the quality and artisan nature of the beer we love, I think people need to chill out.

  6. John, I think you’re probably right about most beer drinkers. All they care about is what’s in the bottle.

    But for me, it’s about being an informed consumer. That means knowing a bit about the companies that manufacture the products I buy. Many people choose not to eat meat from feedlots or genetically-altered vegetables. Others don’t care where their food comes from, as long as it tastes good. It’s really up to each consumer to decide whether the motives and methods of the companies behind the products they purchase are important to them. I’m sure for most people, Terrapin’s connections to MillerCoors simply don’t matter. Like Goose Island and InBev, if the beer tastes the same, they’ll still buy it.

    My goal with these kinds of posts is to make sure that the Aleheads that DO care about who makes their beer are kept informed. I’m also hoping to raise awareness amongst the part of the population that is just getting into craft beer and perhaps doesn’t know about a lot of the behind-the-scenes machinations of the macros.

    The beer industry is large and complex and I know it’s too simplistic to boil it down to Craft Beer = Good, Big Beer = Bad. But if you’ve been paying attention over the past few years, you know that companies like AB InBev and MillerCoors have spent a lot of time and money trying to curtail the growth of craft since it’s hurting their bottom line. I, and many others like me, are making the choice not to support those companies or any other breweries they are connected with. I bristle when people tell us to “chill out” or “grow up”. What’s wrong with supporting businesses that I believe in? What’s wrong with choosing not to give money to companies that are trying to hurt an industry I love? I don’t think that’s immature or naive. I think that’s the way it should be.

    1. I appreciate where you’re coming from, Barley. I’m not saying people should ignore the background dealings that allow beer to get made. I just don’t like the blanket assumption that a deal (which may be mutually beneficial for both companies) automatically devalues a particular brewery.

      There are deeper political machinations at action, for sure, but I personally choose to focus on the end product. If Terrapin or Goose Island makes a great beer, then it is a great beer, regardless of who bought the raw materials.

      For the record, I would love nothing more than for craft beer to pass 50% market share and supplant mass brews. But I don’t think these isolated deals are a doomsday slippery-slope that most people assume they are. They are simply business. 95% of craft companies are still doing it the way we believe in.

  7. well, to restate my comment, the monies from the sale of Terrapin and Goose Island beers now are in some small part at least, helping to fund the lobbyists for big beer who are fighting to keep their restrictive distribution laws on the books. If that doesn’t bother you at some level, then you must not have ever been involved in walking petitions around to get laws changed or spent time at your local state capitol trying to talk to legislators. Or had a favorite brewery go under in no small part due to a inability to get distributed. We are only able to drink beers in GA like Big Hoppy because of buckets of time spent by folks doing these things in the very recent past. And if MillerCoors had their way, no other laws in the country would EVER change.

    There are real and valid reasons that this sort of deal bugs the hell out of folks.

  8. Terrapin is still running a business, as much as some idealists would like to beat them up for doing what seems to have been their best option to continue brewing the beers that you all confess to loving.

    Of course there are side effects to growing and having to bringin new investors is one of those. The infusion of cash & support that comes from MillerCoors investment into Terrapin beers isn’t the first time that money from Terrapin sales would go to their new investors. Money already flows into the pockets of “big” beer through Terrapin’s extensive use of the MillerCoors wholesaler network; to think otherwise is naive. The same goes for most other craft breweries. Were it not for the extensive distribution network that surrounds ABInBev, SABMiller & MillerCoors, many of our favorite local breweries would be able to afford the sales & distribution network necessary to market & deliver their delicious beers, Rather than bash Terrapin for making a smart & responsible move to secure the future standing of the company & their beer, you would rather have them go under?

    Keep drinking Terrapin because in the end, its better to support John & Spike’s vision than punish them for making a responsible business decision.

  9. Thanks for your reasoned responses, John and Andy.

    I’m not asking for a general boycott of Terrapin’s products. Actually, I’m not asking for ANYONE to stop drinking their beers. Most of the posts on this site are the works of individuals and this post was just my attempt at explaining why I will personally be ending my relationship with Terrapin’s offerings. There are many breweries in the country who have found ways to grow without resorting to giving minority stakes to the likes of InBev or MillerCoors. I find it very hard to believe that Terrapin couldn’t have done the same considering their reputation and the lack of major competition in their region (at least relative to other parts of the country).

    I don’t want Terrapin to go out of business nor do I want any of their employees to be put out of work. Fortunately, our little blog doesn’t have even the slightest influence on the buying trends of beer drinkers so I wouldn’t worry too much about the effects of this post.

    Really, I just want to keep people informed so they can make their own decisions…just as the commenters on this site are doing. Some of you agree with me and would rather support truly independent breweries. Others consider this business as usual in a tough industry and see no reason to change their loyalties to a brand. Both responses are perfectly reasonable and I do appreciate everyone’s input.

    Andy, I can’t argue with you at all about the problems inherent with Big Beer-controlled distribution networks. That’s a whole ‘nother issue and one steeped in all sorts of legal and regional complexities. Battles of distribution will practically define the industry over the next few years.

    Thanks again for adding your two cents. Everyone chooses to support certain breweries for their own reasons. I’m choosing to pull my support of one brewery for the reasons stated above, but I would never hold it against anyone for disagreeing with me.

  10. John Cochran from Terrapin here.

    While I know that there is nothing we can say that will help some people get over their hatred for anything associated with big beer, I’d ask you to consider the full story.

    At our request Tenth and Blake simply converted a portion of their existing debt to a minority equity stake to enhance our balance sheet and allow us to work with banks to get the funds we needed to expand. Spike and I still have complete control of Terrapin, and Tenth and Blake’s involvement does not change that. In fact, the reality is that we’re now actually more independent to run Terrapin the way we want to because we are no longer servicing the substantial debt we racked up fighting our original “good-guy, local” investors. They wanted to cash in by forcing Spike and I to sell Terrapin to a West Coast beverage equity fund investor who stated he was bringing in outside management to run the company. Spike and I would have been out of the company we founded and built over the past 10 years. Instead, we now have a shareholder that is in the beer business for the long term. We’ve spent the last year getting to know them, and it’s clear to us that they understand what has made Terrapin successful thus far, and that they also understand that protecting those things is in their best interests. We would not have done this conversion otherwise.

    We ask you to judge us based on what we do. If you are a craft beer fan because you enjoy great beers and the people behind those beers (such as Spike and myself), then you have no worries. We are not going anywhere. All I can tell you is to wait and see. Actions do speak louder than words.

    Not much else to say. Whatever you decide in regards to Terrapin, thanks for your support to this point. Lots of great things are coming. We hope you decide to continue to give us a try. If not, there are a ton of other great beers out there, and I’m going to continue drinking them just like I always have. You do the same.



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