Thursday, 7 April 2011

April 5, 2011

No new beer today.  I’ve just been feeling too miserable.  I tested out something suggested by Nicholas Pashley in Notes On A Beermat and consumed a tin of Headstrong Pale Ale Monday night to see if all those hops would help me fight off an on-coming cold.  No luck. 

Speaking of miserable, let’s talk about investing in beer.  Warren Buffett says, “Buy what you know.”, so I thought I might do pretty well. 

Before I go on any further, disclaimer, disclaimer, your mileage may vary, past performance does not guarantee future results, etc., etc.  What follows is strictly cocktail party talk, and in no way shape or form should any part of this be construed as a recommendation.  Anyone who says different is itchin' for a fight.

About a decade ago, I noticed that Brick Brewing Ltd. (BRB) seemed to trade between forty and sixty cents, which was about my price range at the time.  I got into the habit of buying it at forty.  It would usually go lower but no worry.  I would sell at sixty and sometimes it would go higher.  Then it ran away from me and never returned to forty.  We will get back to this one later.

It wasn’t a particularly proud moment but I had a “stink bid” on the table the morning of September 11, 2001 for Unibroue (UBE) which was picked up in the panic before the Toronto Stock Exchange decided to close for the rest of the day (and then some, as I recall).  I sold this for a decent profit but nothing like the sixty or sixty five times earnings that Sleeman paid for it a couple of years later.

Speaking of Sleeman (ALE) I did reasonably well with that one.  I traded in and out and I made a good profit when it was bought up by Sapporo.

Much the same happened with the buck-a-brew folks at Lakeport Brewing (TFR.UN) when they were purchased by Labatts.  This was a nice one.  They paid monthly income, with numerous bonus pay-outs.  That I didn’t like the beer is of no importance.  I trade like a mercenary.  I have no interest in who is right or who is wrong, who is good or who is bad.  I just want to be on the side that is winning.

For a long time I held Big Rock Brewing (BR.UN).  Again this paid a nice distribution and like Lakeport this was raised a few times.  Good beer, too.  After the legislation concerning Income Trusts was tabled I dropped this one, again for a profit.

I used some of the proceeds from the Sleeman buy-out to get back into Brick which dropped precipitously soon after.  It is currently worth about half what I paid.

Another less than stellar trade was Fort Garry Brewing (FGA).  This was trading at forty cents but there was a bid from Russell Breweries (RB) to buy it out by way of a straight share exchange.  RB was trading at sixty cents.  It seemed like free money.  Of course, once all the approvals had been received, RB promptly dropped to forty cents.  Not long after the share exchange I managed to get out of Russell with a thin profit which was a bit of luck as it is trading much lower when I last looked.

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