Schenley Industries

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Old bottles of the Schenley distillery

Schenley Industries is a former American beverage company specializing in alcoholic beverages. It was founded as Schenley Distillery in 1892 and bought by Guinness in 1987 . Between 1934 and 1937, Schenley was the largest liquor manufacturer in the United States.

history

Established until the end of Prohibition

The chemist Frank Sinclair, his brother, and a partner named Henry Bischoff found an underground river near the bend of the Allegheny River and its tributary, the Kiskiminetas River , northeast of Pittsburgh . The three partners bought the land over the river from the owner, Mary Schenley, and founded the Schenley Distillery in 1892 . This distillery was Bourbon made.

During Prohibition , Schenley was allowed to produce medical alcohol under strict government supervision. The Schenley Products Company was founded in order to be able to operate economically beyond that . Over the entire period of Prohibition, a large number of closed distilleries were bought up by the latter, including the original Schenley distillery.

As a speculative investment, the company bought 240,000 boxes of the “Old Overholt Rye” brand in 1924 - this was a remarkable purchase for the political circumstances of the time and due to its large volume. In 1930 a similar investment was made: Schenley Whiskey was bought by the Large Distillery for a total of 3.5 million US dollars. After the end of Prohibition, Schenley was bought by Lewis S. Rosenstiel , who was previously active in the spirits market. With the large quantities of whiskey stored and the distilleries bought up, he found excellent starting conditions.

Rise into the post-war period

In 1933, the Schenley Distillers Corporation was officially registered in Delaware . The owner Rosenstiel became chairman of the board and Harold Jacobi was appointed president. The Schenley Distillers Corporation bought the entire capital stock of the Schenley Products Company for 820,000 US dollars and was thus the new parent company of the emerging group. In order to get new capital from the market, it was decided to go public - the IPO was carried out by the investment bank Lehman Brothers . At that time, Schenley was already the second largest distillery in the United States after Seagram . In the same year a new distillery complex was built in Alladin .

In the decades that followed, the company managed to further expand its market share. This mainly happened through a number of successful acquisitions (see table below). In the first year after going public, annual profits were $ 6.9 million on sales of $ 40.3 million. The next year, profits rose to $ 8.0 million and sales to $ 63 million. The subsidiary Schenley International Corporation was founded in order to be able to carry out exports . In the same year Schenley acquired the New England Distilling Company in Covington , the world's largest producer of industrial rum at the time. In 1936 Schenley acquired the distribution license for Dewar's Scotch Whiskey, which developed into one of Schenley's product flagships.

Two disasters in the 1930s were survived: In 1934 a fire destroyed an 18,000 barrel warehouse in Lexington . In 1937 a number of Schenley's distilleries were struggling with the flooding of the Ohio River .

Between 1934 and 1937, Schenley was already the largest spirits manufacturer in the USA. It was decided to relocate the company's headquarters to New York - here Schenley rented offices in the Empire State Building . In the following years, Schenley continued to buy smaller distilleries and from 1938 to 1943 received the distribution license for Bacardi rum. During World War II, the company produced over 200 million gallons of war alcohol and penicillin for the United States Army under the name Schenley Laboratories .

In 1943 the company diversified into the beer market for the first time: the Valentin Blatz Brewing Company , one of the large breweries in Milwaukee , was bought for 6 million dollars. Two years later the first international acquisition took place: Companie Ron Carioca Destilleria ( San Juan ). In 1946 Schenley became the sole importer of the Mexican coffee liqueur Kahlúa and opened a distillery in Mexico City under the name Schenley de Mexico .

In 1949 Schenley Industries Inc. was founded as the new parent company. Between 1950 and 1964, Schenley made other acquisitions in the spirits and wine industries. In 1957 Schenlabs Pharmaceuticals was founded, but three years later it was sold to the Rexall Drug and Chemical Company.

The Canadian blend Schenley OFC (for "Original Fine Canadian") has been on the market since 1955 and has become the company's main brand, which has received numerous awards.

In 1958 Schenley built the first distillery of the 20th century in Speyside , Scotland , the Tormore -Distillery, which is now a listed building despite its young age. In the same year Schenley separated from the Valentin Blatz Brewing Company and sold it to the Pabst Brewing Company .

Labor dispute in the 1960s

In 1965, the labor fighter César Chávez initiated a boycott of Schenley products with the National Farm Workers Association to fight for the formation of a union for agricultural workers in vineyards. The reasons for the boycott were low wages and poor working conditions. The boycott also attracted national attention thanks to support from the Student Nonviolent Coordinating Committee and the Congress of Racial Equality, and Schenley signed a trade union agreement with the workers in 1966.

Although other civil rights organizations were also called upon to publicly support the boycott, the National Association for the Advancement of Colored People (NAACP) and the Southern Christian Leadership Conference , for example, stayed out. The reason for this was the good relationships that Schenley had with these organizations: In 1965, the company supported the NAACP with $ 50,000 and began offering scholarships for African American students. It is controversial whether this open support was, among other things, made out of the calculation to draw the attention of the African-American market to Schenley.

Schenley under Meshulam Riklis and sold to Guinness

In 1968 the CEO Rosenstiel, who had been active since 1933, decided to sell Schenley to the Rapid American Corporation of the Israeli investor Meshulam Riklis .

In 1987 Schenley was bought by the Guinness Brewery's United Distillers Co. subsidiary for $ 480 million. At that time, annual profits were approximately $ 65 million on annual sales of approximately $ 500 million. Schenley was the sixth largest distributor of spirits in the United States.

The sale of Schenley to Guinness was a controversial one. According to press reports, the purchase came about due to Riklis' involvement in the takeover of United Distillers Co. by Guinness. Allegedly, Riklis bought over five percent of the shares in Guinness in order to increase their price - with the money raised, United Distillers Co. was then taken over. In return, Riklis received the extension of the distribution contract and the American trademark of Dewar Whiskey. By selling Schenley, Riklis distanced himself from these allegations.

Acquisitions by Schenley

The following table lists acquisitions by the Schenley Group - it does not claim to be exhaustive. Some of the listed companies were added to the portfolio as independent subsidiaries, existing subsidiaries were incorporated, while others were renamed, sold or shut down.

Surname year city State / Country
AB Blanton Small Tub Distilling Co. between 1920-1933
Eastern Distillers Syndicate between 1920-1933
John T. Barbee Co. between 1920-1933 Louisville Kentucky
Joseph S. Finch & Company between 1920-1933
Gibson Distilling Company between 1920-1933 Philadelphia Pennsylvania
Greenbrier Distilling Company between 1920-1933 Nelson County Kentucky
Melvale Distilling Co. between 1920-1933 Baltimore Maryland
Monticello Distillery Co. between 1920-1933 Baltimore County Maryland
Napa Valley Wine & Brandy Co., Inc. between 1920-1933
Sam Thompson Gibson Distilleries Company between 1920-1933 West Brownsville Pennsylvania
George T. Stagg Distillery 1929 Frankfort Kentucky
James E. Pepper & Co. 1933 Lexington Kentucky
WP Squibbs and Company 1933 Lawrenceburg Indiana
New England Distilling Company 1934 Covington Kentucky
Bernheim Distillery Company 1936 Louisville Kentucky
American Eagle Distillery 1939 Phoenix Arizona
Oldetyme Distilling Company 1940 Limestone Springs and Cedarhurst Kentucky and Maryland
Crest Blanca Wine Company 1940 Livermore California
John A. Wathen Distillery Company 1941 Lebanon Kentucky
Buffalo Springs Distillery 1941 Stamping ground Kentucky
Pan American Distillery 1942 Phoenix Arizona
Valentin Blatz Brewing Company 1943 Milwaukee Wisconsin
Central Winery 1943 Kentucky
Colonial Grape Products Companies 1943 California
Quebec Distillers Inc. 1945 Quebec Quebec , Canada
Bardstown Distillery 1945 Bardstown Kentucky
Company Ron Carioca Distilleria 1945 San Juan Puerto Rico
Pebbleford Distillery Kentucky
Nameless distillery owned by the US government 1950 Kansas City Missouri
American Wine Company 1950
Dubonnet Wine Corporation 1955
Seager, Evans & Company Ltd 1956 London England
Park and Tilford Distillers Corporation 1958
AH Riise Chemical and Distillers Corporation 1961
Buckingham Corporation 1964

Trivia

  • Schenley was the producer of the Canadian whiskey "Schenley Reserve", which was also called "Schenley Black Label". This was the only whiskey available to American submarine officers stationed on the Midway Islands . He was also referred to as "Schenley's Black Death" because of his taste.
  • When a bomber collided with the Empire State Building in 1945, a Schenley employee saved the lives of over 40 people.
  • In 1953, Schenley Industries introduced an annual award for the best player in the Canadian Football League , the "Schenley Award". Today this award is called “CFL's Most Outstanding Player Award”.
  • In 1976, as part of the United States Bicentennial Festival , Schenley published the book "The Little Black Book 1976", which deals with African American history.

swell

  1. ^ Gilbert Delos: Les Whiskeys du Monde. Translation from French: Karin-Jutta Hofmann: Whiskey from all over the world. Karl Müller, Erlangen 1998, ISBN 3-86070-442-7 , p. 142.
  2. ↑ One source gives the year 1947 as the date of the takeover.