Stroh Says Schlitz Acquisition To Be Repaid By Fall, 1986
MILWAUKEE (AP) _ Stroh Brewery Co. will complete payments on its $500 million acquisition of the Jos. Schlitz Brewing Co. by next fall, a Stroh official says.
The Detroit-based Stroh owes less than $100 million out of $700 million in debt incurred three years ago when the company purchased Schlitz, Christopher Lole, vice president of corporate planning and development, said Monday.
Part of that debt also came from Stroh’s 1981 purchase of the F&M Schaefer Corp. and former Stroh debt.
″In our own mind we had looked upon four to five years to pay off the debt,″ Lole said. ″Our agreements were for longer periods of time, but we thought we could do it by (Labor Day, 1986).″
Lole said the announcement will be made to Stroh wholesalers at a December meeting.
Stroh took $100 million from the Schlitz pension plan, which Lole said was overfunded, to help in the early payment.
Lole also cited the company’s decision to close its flagship brewery in Detroit, where it had made beer for more than 100 years. That move will save Stroh $45 million to $50 million annually, he said.
Lole said the company plans to stay in the beer-making business, but is continuing to expand into to other beverages, such as soft drinks and wine coolers.
″There’s only two ways to gain market share - to take from competitors or to merge and continue on an acquisition route,″ Lole said. ″We will consider both.″