Another Iconic Beer Brand Enters Chapter 11 Bankruptcy: Liquidation Plans Ahead
The closure of Anchor Brewing in July signified a pivotal change in the craft brewery landscape, representing the end of an era for a company that had spent 127 years embodying the spirit of innovation and competition against major beer brands. Once a symbol of success with national recognition and distribution, Anchor Brewing faced insurmountable challenges during the Covid pandemic. As bars shuttered, sales plummeted, leaving the brewery in a precarious financial position.
Though Anchor Brewing’s future remains uncertain, attracting considerable interest without yet being sold, it is not alone in its struggles. Many craft breweries and brands have been forced to shut down due to pandemic-related difficulties.
The situation represents a perfect storm for the industry. Breweries that relied heavily on on-site sales saw their primary revenue stream evaporate, leading to significant financial losses and mounting debt—debts that many breweries could not recover from. This increased financial pressure hampered their ability to pivot or adapt to the changing market, ultimately driving several regional favorites, such as Chicago’s Metropolitan Brewing, New Jersey’s Flying Fish, Denver’s Joyride Brewing, Tampa’s Zydeco Brew Werks, and Cleveland’s Terrestrial Brewing, into bankruptcy.
The latest casualty in this wave of closures is Fargo Brewing, which has recently filed for Chapter 11 bankruptcy protection.
Fargo Brewing’s Community Commitment
Founded in 2010, Fargo Brewing has been more than just a brewery; it has served as a cultural hub, hosting concerts with well-known acts such as Violent Femmes, rapper Prof, and country artist Shakey Graves. The company’s mission has always been to unite the Fargo community through craft beer, emphasizing that its patrons are integral to its identity.
As stated on its website, “Since our inception, we have sought to celebrate the heart and soul of Fargo. We craft each batch of beer with care, ensuring that our offerings resonate with diverse tastes—whether you’re a hop enthusiast or a newcomer exploring approachable styles.”
Fargo Brewing has offered a wide selection of beers, from its traditional Fargo Lager to more adventurous options like the Blood Orange Wood Chipper IPA and the Nitro Stone’s Throw Scottish Ale.
Filing for Chapter 11 Bankruptcy
Fargo Brewing has filed for Chapter 11 bankruptcy protection under Subchapter V of the Bankruptcy Code, indicating its debts are below $7.5 million. The company has assured that it expects to have enough funds to pay unsecured creditors.
While Fargo Brewing has not disclosed a specific financing or turnaround strategy, it informed the court that it possesses assets that may depreciate over time, likely referring to perishable materials used in beer production.
In its bankruptcy filing, Fargo Brewing reported assets between $100,000 and $500,000, with liabilities ranging from $1 million to $10 million. However, the debts must be kept under $7.5 million due to the nature of its Chapter 11 filing.
