Beau’s Brewing Co. and Steam Whistle Brewing have come to an agreement for the sale of the Vankleek Hill-based brewery operation. The two companies issued a joint press release the day after a February 28 meeting of Beau’s 129 shareholders. During a later phone interview, Beau’s co-founder Steve Beauchesne agreed that the week following the announcement has proven very hectic for him and the rest of the company’s senior management.
« That’s an understatement, » he said, with a chuckle.
Details of the purchase agreement between Steam Whistle Brewing and Beau’s Brewing Co. are confidential to the shareholders but almost 100 per cent of the 129 shareholders voted to accept the deal. The shareholders comprise a mix of the original investors in Beau’s at the company’s start up in 2006 and those employees who took advantage of the Employee Share Ownership Plan (ESOP) to buy shares in the company. They will now have an opportunity to invest in a similar employee shareholder program with Steam Whistle Brewing.
Since the announcement of the sale of the Vankleek Hill-based craft brewery, Beauchesne has received or seen numerous comments about the subject.
« About 95 per cent of comments I’m seeing are super positive, »he said. « The one worry for everyone is what it means for Beau’s (operations. The reality is I’m still going to be working here at Vankleek Hill. The reaons people worried is because they care about their brewery, and I love them for it. »
Beauchesne will continue to be part of Beau’s operations while his father. Tim Beauchesne, who is the company’s other co-founder, will now retire at the age of 71. Beau’s Brewing, as a new subsidiary to Steam Whistle Brewing, will have its own board of directors, including Steve Beauchesne and Jennifer Beauchesne and three other directors appointed by Steam Whistle.
« Succession planning for the brewery has been on the horizon for Beau’s, starting with the ESOP we launched in 2016, » noted Beauchesne. « It has taken some time, as it was incredibly important to us to find new ownership that was value-aligned with Beau’s. »
« Merging with Steam Whistle means that Beau’s continues to operate as an independent, Canadian craft brewery, » stated Steve Beauchesne, « which values quality, community and sustainability. »
Greg Taylor, Steam Whistle co-founding and chief executive, described the agreement as « uniting the number one and number two premium independent craft beer brands in Canada. »
A local brewing tradition
Beau’s has been part of Vankleek Hill’s economic and community profile for 17 years. Before he and his son went into the beer-making trade, Tim Beauchesne ran a successful textile-processing business. But during the early part of this century local textile-making outfits in Canada were becoming fewer as most of the business was moving out of the country to offshore suppliers.
« So he wanted to do something fun, » Steve Beauchesne said, regarding his father’s future plans at the time.
Steve Beauchesne himself spent his days doing consultant work for the federal government and at nights playing in a rock band. He and his father discussed possible new business options.
« Over a pint of beer, » Steve Beauchesne said, with a chuckle, « we decided the best thing was to open a brewery in Vankleek Hill. »
While father and son had a good laugh at the idea then, they decided after later sober reflection that it could work. After two years of research and planning, Beau’s All Natural Brewery began operations in 2006.
« We were just about as small as you could get, » said Beauchesne.
The original operation featured « secondhand brewing gear » bought from a New Hampshire brewery, and a staff that consisted of himself and father, Tim, as co-supervisors, with Tim’s wife, Denise, doing the accounts, Steve’s brother, Phillip, sharing sales duties with a friend of theirs, Jamie Kaufman, and Matthew O’Hara as the company’s brewmaster. Tim Beauchesne had a very « hands-on » attitude towards his new position as co-founder and supervisor of a brewery.
« One day, Dad would be scraping out the mash tuns, » said Steve Beauchesne, recalling the early days of the brewery. « The next day he’d be filling kegs. »
The business focus at the start was brewing and selling kegs of its signature Lugtread beer. A bottling line was set up within two years after the brewery began operating. Since then the Beau’s line-up numbers six regular brands of craft beer and eight seasonal varieties for on-site sales and available at local and regional beer stores and LCBOS in Ontario.
As Vankleek Hill’s local brewery grew over the years, it became an active part of the community’s social and festival life, through either sponsorship help for various special events.
« We’ve always had the desire to be a part of the community, »said Beauchesne.
One of the crowning achievements of Beau’s community involvement was making Vankleek Hill part of Ontario’s Oktoberfest circuit of beer festivals for the past dozen years. From a small local festival, the Beau’s Oktoberfest grew to a large and successful regional event that drew crowds numbering in the thousands over a mid-September weekend from all over Eastern Ontario and Western Québec and beyond.
The pandemic closed down the Oktoberfest beer garden though Beau’s tried to host a virtual version of its community festival. For now, Beauchesne observed, « cautious mode » is the working phrase for any community events planning this year but he hopes that Beau’s will be able to host Oktoberfest and help support other community activities again as soon as the pandemic ends.
Dealing with the pandemic
In April 2020, about a month after the official declaration of the COVID-19 pandemic, Beau’s Brewery announced a partnership plan with Dunrobin Distilleries of Stittsville to produce hand sanitizer to help deal with the shortage of sanitizer available for both emergency and medical personnel in Ontario and the general public.
Beau’s provided the materials and Dunrobin the distilling equipment needed to make the sanitizer. Three years later, the two are still making sanitizer as part of their operations and Beauchesne expects it will continue to be a sideline activity for the brewery.
« We saw what happened to everybody when the global supply chain got hit, » he said. « The companies abroad making sanitizer focused on supplying their home markets first. »
The partnership with Dunrobin is an example of the business lesson that the pandemic taught Beau’s Brewing.
« For us, the biggest lesson learned is that we needed to be very flexible, » said Beauchesne, « and that we’re stronger when we work together with other people. »
That was part of the reason early on for an agreement in 2020, several months after the pandemic began, between Beau’s and Steam Whistle to work together on sales of their respective products.
« We both agreed that one of the biggest challenges facing us was economies of scale, » Beaychesne said. « We were both of us too big to be small and too small to be big. »
Working together on promoting and selling each other’s beers achieved significant results within a year. Beau’s went from the number four position for best-selling craft beers at the LCBOs to number one. Steam Whistle was right behind at number two. »
That success, Beauchesne noted, led in the end to the two companies combining now. »
Vankleek Hill’s local brewery grew over the years, it became an active part of the community’s social and festival life, through either sponsorship help for various special events.