Brewery has bottling deal

0 Comments | La Crosse Tribune, Feb 07, 2001 | by Cahalan, Steve

City Brewing Co. on Tuesday announced an agreement with Hornell Brewing Co. to make AriZona ready-todrink teas and some other beverage brands the New York-based company owns or markets.

It is the La Crosse brewery's largest contract to make beverages for another company and will mean additional jobs this spring or summer, City Brewing President Randy Smith said. He had no prediction how many jobs will be added at the brewery, which now has 54 employees.

"It's a good sign," said Ron Buschman, a business agent for Teamsters Local 695, which represents the brewery's unionized employees. "There will be some increase in employment," he said, declining to say how many jobs might be added.

Hornell products are made under contract at about nine facilities around the United States, Hornell spokeswoman Francie Patton said. The company, based in Lake Success, N.Y, does not own any production facilities,

"I think as time goes on, we'll be doing a great deal" of the company's production in La Crosse, but not all of it, Patton said.

Hornell markets more than 30 different teas, coffees, cocktails, juice drinks and other beverages. They include AriZona teas, AriZona Rx natural herbal tonics, AriZona and Blue Luna iced coffee drinks, Mississippi Mud beer, Crazy Horse malt liquor, Palm Beach Margarita and Cosmopolitan Flavored Malt Beverages.

As part of the agreement signed Friday, Hornell will invest an undisclosed amount of money in the brewery to enable it to hot-fill beverages in bottles or cans. That is a preferred method of packaging ready-to-drink tea and other natural beverages because it protects the purity of the product without the use of preservatives, the two companies said Tuesday.

Hornell's investment also will enable City Brewery to apply pressuresensitive and shrink-sleeve labels to bottles. Both types of labels have become the signature look of "new age" beverages, the companies said.

The brewery should start producing and packaging AriZona Iced Tea in cans next month, Smith said. Bottling of AriZona products probably is at least two to three months away, he said.

"Their capital investment will enable our facility to offer an expanded range of beverage production for AriZona and for other beverage companies," Smith said of Hornell.

Hornell's owners, Don Vultaggio and John Ferolito, will become investors in City Brewing and Vultaggio is expected to become a member of its board. "Don (Vultaggio) is one of the-smartest marketers in the beverage business and he will personally be a huge asset for our company," Smith said.

Smith declined to say what percentage of City Brewing will be owned by Vultaggio and Ferolito. "It is not a large percentage," Smith said. "No bigger than anybody else's."

Smith and 11 other investors purchased City Brewing in November. from Jim Strupp and John Mazzuto, who had purchased the former G. Heileman Brewery from The Stroh Brewery Co. in November 1999.

"The fact they are making an investment (in the brewery) is significant," Smith said of Vultaggio and Ferolito.

The La Crosse brewery made AriZona Iced Tea for Hornell about six or seven years ago, Patton said. "It was one of our first facilities to make the product," she said.

"I think it made good sense for us" she said of Hornell's investment in the La Crosse brewery. "We've made our product at some facilities that have gone bankrupt. It always seems like we're trying to find more production (facilities). If you have a place where you make a major investment, you know your product is going to be produced."

City Brewing officials say theirs is the largest brewery in the United States not owned by Anheuser-Busch, Miller or Coors.