Another Iconic Beer Brand Files for Chapter 11 Bankruptcy Amid Industry Challenges
When Anchor Brewing closed its doors in July, it marked a significant moment in the craft brewery industry. The company, with its 127-year history, symbolized the spirit of small breweries offering alternatives to big beer brands. Anchor Brewing had achieved national recognition and distribution but ultimately couldn’t survive the financial hardships brought on by the COVID-19 pandemic. Sales plummeted as bars shut down during the lockdown, creating a financial hole that the company couldn’t recover from.
The future of Anchor Brewing remains uncertain as it has attracted interest from potential buyers but has yet to be purchased. Anchor’s situation, however, is not unique. Many breweries and craft beer brands have faced similar struggles, with the pandemic causing a wave of closures across the industry.
The craft beer sector was hit hard by a perfect storm of challenges. Breweries that depended on on-site sales lost a major revenue stream as customers stayed home. The resulting losses led to debt that many businesses couldn’t repay, stifling their ability to adapt to the new normal. Declining demand further pushed regional favorites like 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.
Now, another well-loved regional brewery, Fargo Brewing, has filed for Chapter 11 bankruptcy protection.
Fargo Brewing: A Community Staple
Fargo Brewing is more than just a beer maker. It’s a community hub, hosting outdoor concerts featuring well-known bands like the Violent Femmes, rapper Prof, and country artist Shakey Graves. Founded in 2010, the brewery has worked to bring people together through the art of craft beer, maintaining a strong connection to its Fargo, North Dakota, roots.
“Since its founding in 2010, Fargo Brewing has been on a mission to bring our community together through the art of craft beer. We understand that you are more than just beer enthusiasts; you are the heart and soul of Fargo, and we are here to celebrate you,” the company shares on its website.
Fargo Brewing prides itself on being a local brand with a diverse lineup of beers. Its offerings range from the classic Fargo Lager to more adventurous brews like the Blood Orange Wood Chipper IPA and the Nitro Stone’s Throw Scottish Ale. The company’s beers are available both at its brewery and select other locations.
Chapter 11 Bankruptcy Filing
Fargo Brewing has filed for Chapter 11 bankruptcy protection under Subchapter V of the Bankruptcy Code, indicating that its debts are less than $7.5 million. Despite the bankruptcy filing, the brewery stated it expects to have enough funds to pay its unsecured creditors.
The company hasn’t yet disclosed a formal financing or turnaround plan, though it did mention to the court that some of its assets, like perishable goods used in beer production, would lose value over time. Fargo Brewing reported assets valued between $100,000 and $500,000, with liabilities falling between $1 million and $10 million, though under $7.5 million as per the filing requirements for Subchapter V.
Despite the bankruptcy filing, Fargo Brewing remains operational, and concerts are still scheduled on its website, with tickets available for events well into July.
