Mt Eden-headquartered brewer and gastropub operator Brothers Beer has slipped from voluntary administration into liquidation despite hopes it could be restructured and saved.
Companies Office records show on Wednesday, creditors resolved to appoint PwC’s Stephen White and John Fisk as liquidators of the businesses.
They had been appointed administrators in August and the liquidation is only the latest in a string that has hit the sector after a 10-year boom.
The two accountants this month issued a detailed six-monthly administrators’ report about recent events.
On August 7, they were appointed to Brothers Beer, Brothers Beer Holdings and Brothers Wholesale.
The shareholders had also agreed to pour money in to try to keep slimmed-down operations going.
The PwC accountants outlined the history.
Brothers Beer and Brothers Beer Wholesale started operating in 2011 and 2016, managing a brewery and operating seven gastropub-style restaurants across Auckland in what were the good times last decade.
That was when it was all in an expansion phase and craft beer was a catch-cry, drawing people to sample a new style of drink.
But then it struck financial trouble and the initial administrators’ report told how the business would cease operations at its many Brothers Beer and Juke Joint BBQ sites in Ōrākei, the City Works Depot, Onehunga and Birkenhead.
By that stage, the business had already ceased at Commercial Bay.
Pre-pandemic, Brothers Beer was popular and had expanded hospitality outlets, going from one to seven, that report said.
But when Covid hit, the brewer and pub manager could not operate those venues due to lockdowns, and that significantly hit their financial position.
Then inflation began to take its toll, creating further pressures as well as rising costs that hurt margins.
The PwC accountants talked to suppliers and the group’s secured lender. Non-performing hospitality sites were closed immediately and staff were redeployed where it was possible. Some redundancies were required, PwC said.
Herald business editor at large Liam Dann interviewed people at the Brothers Beer City Works Depot outlet. People included ex-Finance Minister Stephen Joyce, Craig’s Mark Lister and economist Christina Leung.
The administrators continued trading operations in Mt Eden where the main brewery was, as well as a pub and restaurant at Piha.
Any assets or equipment not needed were sold via auction and tender.
Kiwibank had the first-ranking security over the group’s assets.
In September, creditors voted in favour of a deed to restructure those companies, but now they have made the liquidation call.
So the PwC accountants have begun that process.
Last year, White and Fisk were appointed to the group’s three entities and they said in September they hoped to be in a position to put a “credible” restructuring proposal to creditors for a vote.
“The objective will be to deliver a better outcome for them than if the group is simply liquidated,” White said at the time.
Brothers Beer was founded by Anthony Browne and Andy Larsen who sold their products through their venues and to supermarkets and liquor stores.
In its heyday, it had about 200 flavours on offer and the businesses reportedly employed about 70 staff.
Last year, the Herald published its craft beer power list: the brokers who launched a beer revolution and the challenge with the froth coming off.
Anne Gibson has been the Herald’s property editor for 24 years, written books and covered property extensively here and overseas.