After 127 years of operation, San Francisco’s beloved Anchor Brewing Company shut down operations earlier this year. Bought by Sapporo in 2017, Anchor Brewing’s revenues had been declining for years before the call was made to liquidate the business. But workers are fighting back to save their jobs—and this historic city icon. Patrick Machel and Kieran Engemann of Anchor Brewing speak with Staff Reporter Mel Buer about their union’s campaign to buy out the brewery and reopen it as a co-op.

Studio Production: Adam Coley
Post-Production: Alina Nehlich

Transcript

The following is a rushed transcript and may contain errors. A proofread version will be made available as soon as possible.

Mel Buer:

Welcome back to another episode of The Real News Network podcast. My name is Mel Buer and I am a staff reporter here at the Real News Network. I am so glad that you’re back with us. The Real News is an independent, viewer-supported nonprofit media network. We don’t take corporate cash, we don’t have ads, and we don’t put our reporting behind paywalls. To stay up to date on the important stories that we’re covering, sign up for our free newsletter at therealnews.com/sign-up. Follow us on social media and consider becoming a monthly sustainer at therealnews.com/donate.

Anchor Brewing first opened its stores in San Francisco in 1896 and is widely considered to be one of America’s pioneers in craft brewing. The beloved California institution has survived the peaks and troughs of extreme economic conditions in the United States as well as prohibition and two world wars. But according to spokespeople for Anchor’s parent company, Japanese beer giant, Sapporo, the brewery could not survive the economic fallout from the pandemic and announced last month that it would cease operations after 127 years.

Anchor’s unionized workforce represented by International Longshore and Warehouse Union, Local 6 released a statement via the union that read in part, “To Sapporo, Anchor Steam was just another line item in the budget of their multi-billion dollar corporation and an asset to be cut up and sold. But it is the workers in the city of San Francisco that will suffer the consequences. In an effort to save the brewery and keep a respected San Francisco institution from dissolution, Anchor workers put their heads together and are making an attempt to purchase the brewery from Sapporo and turn it into a worker coop. Here with me to talk about this incredible story are Patrick Machel and Kieran Engemann. Patrick is a production lead, an Anchor Brewing Union shop steward, and Kieran works in the packaging department. Thanks for coming on the show, guys.

Patrick Machel:

Thank you.

Mel Buer:

To begin our conversation, I would like to get our audience up to speed on the organizing that’s been happening at Anchor Brewing over the last couple of years. Can you just give us the broad strokes of your unionization at the brewery and what’s been going on up to the announcement of the sale?

Patrick Machel:

Yeah. From the beginning, we did our underground campaign around 2018-ish. Went public around 2019, got our first contract in about seven months. Pretty historic contract because we’re the first craft brew union in the country. So we didn’t really have a lot of examples to take, so we had to essentially create our own contract through just what we were doing. And then that was a three-year contract. Then we just got our second contract about a month or two months before the news came out to the public that they were shutting down. That was a longer fight. We were ready in July of the year before, pretty much told the company that, “Hey, we’re ready. Let’s do this because it’s going to be a long contract fight. We want to change a lot of things, and they denied it until January thinking that they could get a contract done in three months.”

It didn’t. We ended up going four or five months, so we were out of a contract for a little while and eventually we had to get a mediator into the negotiations and… Someone is vacuuming. So we have to get the mediator and here we are today. It’s closing down. Took us by surprise. We knew the writing on the wall anyways, but just the amount of… Or the quickness that it happened almost seems like a big middle finger to the working people there. But that’s broad stroke.

Mel Buer:

Yeah. It seems like just from the brief bit here about how the union contract was kicked down the road, the negotiations took so long. It doesn’t seem like the company was dragging its feet for the express purpose that they knew the sale was coming down the pike. Do you even want to speculate on that or what’s your sense of that from the shop floor?

Kieran Engemann:

I mean, I don’t want to speak for Patrick, but I know that it felt at times that there was just not a lot of clear communication and not a lot of clear direction out of higher management. That’s just the feeling from… Patrick could have a much better understanding because he’s there talking to them constantly, but for most of the guys on the brewery floor that aren’t involved in all the Caucus, Inc., that’s just your day-to-day kind of feels like that. There’s a massive gap between how we can communicate with the people upstairs, how they communicate with us. And I think you saw it affect a lot of things, mainly like the contract negotiation. I don’t know if it was necessarily malice, but it definitely just seemed unorganized.

Patrick Machel:

I feel like they were dragging their feet and they wanted to get it done and clean really quickly, not understanding how much we were invested into trying to change it the last month or the meeting that they had with us saying that they’re closing down and they’re enacting… Or we got the WARN Act thing, so we got our severances and stuff like that is they were saying that they were trying to sell it for a year before, but we never heard any news of this happening until that month.

I’m pretty sure they knew and they just were playing dumb to us the whole time. The people that were managing Anchor weren’t really Sapporo employees. They were still Anchor employees. And I feel like Sapporo kept them in the dark too. Or if there was people that knew what was going on, they’re being assholes about the information. But they wanted to do a wage freeze for their first economic proposal and then do a 1%-1% raise for three years, and we were like, “No. The inflation has gone crazy. We’re doing multiple jobs. We had to learn automated robots.” Kieran helped me out on setting that automated robot up in the morning, but it’s way more involved of a process now with half of whatever the staff was in the first contract. So of course we wanted to change things, but the fact that they wanted to do a wage freeze, really glad that we pushed back against that because then we would’ve had nothing and then they would’ve closed and we would’ve gotten no raises whatsoever.

Mel Buer:

So the sudden closure announcement comes down last month from the various Twitter posts and really just the response across the internet. It came as a surprise to pretty much everyone that this was going to happen. I mean, this is a San Francisco institution. This brewery has been around through the San Francisco earthquake, through World Wars, through prohibition, through all these, the Great Depression, through all the sorts of things that you would consider to be life altering economic crises. And the response that these books people are giving to journalists who are asking questions is that the pandemic economy is finally the thing that’s causing it to shut its doors. What was the union’s response? I mean, obviously this came as a shock to everyone. As far as I know, The Chronicle was putting out articles before you even got notified, right?

Patrick Machel:

Yeah. 2:00 in the morning, which I guess we found out that that’s when Japan’s market closes. It’s around 5:00 or 6:00 PM over on their side, but they got it before we did. So my phone died pretty much that whole week because everybody was reaching out. The responses that the company was giving like a lazy response, in my opinion.

Mel Buer:

Yeah. What do you think is really going on here in terms of the closure? Do you really think that this is due to the economic conditions or… Again, I’m not trying to get you to speculate, but it does seem a little weird. This is a multi-billion dollar corporation that just won’t… What do you think their reasoning is?

Patrick Machel:

Kieran, do you want to answer that? I figured you’d want to.

Kieran Engemann:

Yeah. I mean, I guess really it would be speculation on my part, but it feels like it’s a multi-billion dollar corporation. Like you said, they have plenty of other breweries. They had just bought Stone, which just expanded. It’s not like Sapporo was necessarily hurting. If they really wanted to try and pump life into it, I think they could have. The funds I’m sure were there. I think it just became more of a headache than they wanted it to be. And they also had just recently purchased Stone, so they had another area to set up a headquarters in the United States. They have three Sleeman Breweries in Canada, so they have plenty of locations in North America. I think they kind of just got disinterested and wanted to move on.

Patrick Machel:

And the thing is, with our brewery, it’s a very unique brewery. We have parts in there that were made in West Berlin, and that line has been running for decades and decades just kind of improving on itself. And the processes that we do are kind of antiquated. And the thing is, with our company, there’s a love of the craft of what it is and an understanding of what we mean to San Francisco and its culture that beer tastes change. It’s the industry, and it’s kind of in a downward spiral right now in breweries of our size. But it almost felt like Sapporo had no idea what Anchor was, didn’t really care about whatever the history was.

It’s pretty clear with that rebrand that they didn’t understand what type of people bought this beer. And with that rebrand, we were already getting heat for Sapporo buying us out because that’s like a selling out kind of situation. But then the rebrand goes and it’s like, “Well, there goes any diehard Anchor fans that we had.” Right?

Mel Buer:

Right.

Patrick Machel:

It feels like they didn’t take any care or time or effort into what we were as a workforce and what we were as a company.

Mel Buer:

Right. But certainly I would assume that a lot of that is a motivating factor for the workers coming together to try and buy out Anchor from Sapporo and turn it into a worker coop. Do you want to kind of expand a little bit more on your reasons for doing that beyond… Because we’re not just talking about saving the brewery for the sake of the jobs of these individuals. We’re also talking about reaching back into the community and really trying to preserve an institution that caress about the San Francisco community and cares about its place in that community. And it certainly feels that way in how you’re starting to fundraise for this, but you just want to give a bit more about the motivations for even going to the corporation in the first place.

Patrick Machel:

You want to take that?

Kieran Engemann:

Yeah. I’ll do it. I can.

Patrick Machel:

We’re going to let you.

Kieran Engemann:

Yeah. I think one of the driving forces about trying to go into the coop is wherever you are in the beer world when you work at Anchor, I was not a huge craft beer person. I’m not very particular about beer, never had a position in a brewery before, never did any home brewing, but it doesn’t take you very long when you get into Anchor to feel that historic love for the place. I think a lot of us just couldn’t stand to let it go like that. I mean, there was no lead up. It just suddenly dropped on us.

Sure, we saw certain things that made it look very apparent that that was the future of the brewery, but it’s like we never got a chance to do anything. And we have a lot of legacy employees. That’s what we call guys who were there for Fritz’s ownership and his whole thing when he owned it, and what those employees pass down to you as a new guy coming in is to really care about what you’re doing, whether it’s making boxes, taking slip sheets off. Whether you’re in fermentation, take pride in it.

Because every piece of the puzzle affects everything down the line, whether you’re making boxes, whether you’re making the beer. I think when you’re constantly taught that when you work there, you’re not going to just let the doors shut. And ultimately because we are constantly the ones working on all of it, and we’re the ones picking up the pieces when things go awry, I think we all felt like, “Hey, we basically run this brewery anyways, so why are we going to let it go into the hands of another corporation? We don’t need this hassle. We don’t need this headache. What can we do to make sure that we’re still there?”

I think it’s surprising. I was in our first meeting that Pat and the union set up about whether or not we would want a coop. I was surprised how many people went just because some people had pretty openly expressed like, “Hey, I don’t know. This place has warned me out in the last few years.” And reasonably so we had a lot to deal with, but just about everyone showed up and guys who were very historically not pro union were immediately like, “I don’t care what it takes, I’ll join the union. I’ll do this, this and that. Whatever it takes to make sure this place stays open.” So there’s just a lot of congruency in the fact that all of us take the utmost pride in this place and we can’t stand to see it close.

Mel Buer:

Yeah. Patrick, what was the process for, you have this meeting, you have seen that folks are expressing a willingness, an ability to go all in on this worker coop proposition, right? What’s next? You send a letter to the company. What is the company response been like? Or where are we at in terms of how did the process get started and how do you feel about the fundraising, things like that?

Patrick Machel:

Yeah. So there was a couple of questions in there that I might miss, but essentially it’s always been a running joke on what if we own this place? And I think when the closure happened that the gears in my head were just like, I’m not even going to think that this is actually a reality and just try and push for this. I asked our international organizer, Evan McLaughlin, “Yo, what would it take to do a coop?” And he was like, “I don’t know, but let’s go talk to people.” And it pretty much was hitting the ground running. We were learning new things every day. Every week the group turns a little bit bigger. There are people that used to work there that were in pretty high positions that we reached out to and asked if they would be willing to help us out.

I mean, we’re production workers. We don’t know exactly how to run a business. I mean, not yet at least. But having that kind of experience at the table and what Kieran said earlier with people that were pretty anti-union coming into the fold and seeing that these are union workers that are starting this process, that they’re behind us with it. We did give notice to Sapporo that like, “Hey, we are trying to buy this. What do you want from us? “And they gave a response with, “If you have a qualified individual or something like that, I’m assuming a lawyer, then we could talk about it being serious.”

So we sent them a bankruptcy lawyer, and then they dragged their feet for a little bit, I think a week, which the news came out and it was like three weeks later we’re done. So a week is a lot. It’s very short time to get around to this. But they gave out some financial information. We know of two investors, and then we asked for it so that we can make a competitive bid and actually start the fundraising for it. We don’t know how much it really is worth or how much Sapporo is trying to get rid of it for. And they didn’t respond. And then out of nowhere they’re just like, “We’re closing this to anybody and everybody. It’s too close to the August 1st date, blah, blah, blah.” And then we haven’t heard anything pretty much since.

Our bankruptcy lawyer has been talking to the assignee because it isn’t technically a bankruptcy like a chapter seven or 11, it’s something that they use called ABC process which stands for the assignment to the benefit of creditors, which is a quicker, faster way of pretty much what a bankruptcy is. But I guess our bankruptcy lawyer has been talking to the assignee and they’ve been trying to establish some contact.

I have another call after this that we’re setting up a bank account to start fundraising and getting a GoFundMe. We already have an LLC for the new company trying to move as quickly as possible, but we’re kind of in the dark. And the fact that they gave it to two investors that were basically like, “I got 20 mil.” “All right. Well, here’s all our financial information, and then your own workers ask for that and you drag your feet and then you act like it’s not a real attempt at buying,” it goes to show how much that they actually respected us.

Mel Buer:

Yeah. It seems like they’re just not taking it seriously at all, and it is a serious business proposition. Making the decision to assume the responsibility of a business like this. And converted into a worker coop is not something that you take lightly and it definitely shows how much you and your fellow coworkers really care about the place that you’ve built careers in and you want to see that institution continue.

So in terms of raising funds, you sort of appeal to the wider community you have have the idea to do more crowdfunding. Is there any other funding fundraisers or things that you’re doing that you can talk about now that are part of that plan? Or is this really going to be something that you really want to really lean on the community’s support to help you accomplish?

Patrick Machel:

Yeah. So it’s interesting because we were talking about coops and actually buying a business. There’s a lot of legalities that are involved with it. I can’t just put it into my bank account because then there’s problems legally with that, which is why some of this process is a little bit longer than what we thought. We just want to make sure that when people are putting money into this or helping us crowdfund to it, we have to be very clear that this isn’t investing in the company yet.

This is just only helping us out with certain fees. And if we don’t explain that to people, then we can get into a lot of trouble with that. But that’s why we’ve teamed up with some solid lawyers like Project Equity specializes in doing this kind of thing as well as Tuttle Law Group which is also helping us out tremendously on this, that they have been essentially running us through what we need to do.

We’re working on a business plan. I think we have a meeting later this week about it, but funding wise, I’m assuming it’s going to happen probably in this week and we’ll probably put it out on one of our social medias. But other than that, we have a little team of people also trying to work with other breweries to try and bring it back to the craft of collaborating with breweries. Because once you go corporate, you’re kind of just like, “We don’t care about anything, we only care about our profits.” And the fact that we’re trying as workers trying to reach out to other breweries and be like, “Hey, we’re trying to buy this back,” you want to make something.

We call it a solidarity, which is based off a recipe from way back in the day that used corn as the main ingredient because it was a lot cheaper that we feel like it made sense for other breweries to tap in on this and then they could sell it if they want, but also put proceeds into this fund that we’re going to set up. It’s a fun way to get your local community on board. We’ve been telling people to reach out to our Twitter or email to get the recipe from us, and then obviously they could tweak it. It’s their brewery.

We don’t have a facility to brew it, so we can’t really do it. But yeah, that’s the major thing I think we’re trying to work on to put it out there that we’re not craft brewers, but we’re a craft brewery and we’re trying to bring it back to whatever its roots are.

Mel Buer:

Right. Kieran, sort of a follow-up question to that then. What has been the public’s response to this whole effort? Obviously on social media, you saw quite a bit of shock from a lot of people. How has that translated to support from the community at large in San Francisco?

Kieran Engemann:

It’s pretty funny because we were all kind of taken aback the first couple days when we announced the closure. It felt like the entire city of San Francisco was inside PTAPs buying whatever they could. They wanted to show like, “Hey, we appreciate merchandise, we appreciate you.” People were wearing shirts with pretty tasteful messages to Sapporo, which was pretty entertaining. But it happened so quickly. Just about as quickly as us announcing the shutdown, everybody was talking about how they couldn’t believe it. They wanted to support us. I mean, it’s up and down. I mean, my girlfriend’s family is from Wisconsin, and there’s people in the Midwest who they don’t get Anchor that consistently or anything, but they’re like, “I can’t believe this. It used to be the thing where if you went to California, you would come back with Christmas sale.”

They knew about Steam. They understood Steam. They really appreciated it. Her dad actually sent the family photos of him buying the last two variety packs in their grocery store.

Mel Buer:

Wow.

Kieran Engemann:

So it’s just like everybody wants to know what they can do. One of our family friends who lives actually pretty close by, grew up in SF his whole life. He’s very vocal and he’s like, “However, I can help and get in and support this, help fund it.” And everybody loves the fact that it’s a coop. I mean, beyond just saving Anchor, everybody is so hyped about the idea of us cooping it. I think if there was rumblings of a new investor like a new Fritz or something like that, people would be like, “That’s awesome, sweet. Anchor gets to stay alive.” But I think the fact that it’s the workers’ push, it’s a coop, it makes everyone feel like they get to have their hands in it, and it makes everyone feel like Anchor really is their beer.

They’re just as much a part of the brewery as anyone else. They’re just as much a part of the history. And I think that gets people riled up more than anything to try and make sure that this doesn’t go down. I mean, our Instagram Anchor Union SF does a great job of plugging everybody who shouts us out. And you’ve seen some really creative stuff. Some guy just made a song about it, which is pretty cool. Up and down the streets, everybody is about it. My neighbor I see walking around in a yellow Drink Steam hoodie a lot, which is pretty hilarious.

Everybody came out to support. And I hope it doesn’t die away. It doesn’t feel like it. I mean, we’re three weeks removed, two weeks removed, which isn’t that long. But I think that’s long enough for Fever to die off, and I think people are just as about it as they were the day was announced.

Mel Buer:

Patrick, anything to add? I mean, I really want to drive home the point here that we’re not just talking about saving a brewery for the sake of good beer. It really is a sort of worker led movement to really kind of save a cultural institution in the city. And I think a lot of folks across the country see a story like this, and I don’t want to reduce it to the underdog against the corporations kind of story. You know what I mean? But there is something really magical and beautiful about this idea, especially in the current wave of labor organizing in this country, the working people against these faceless corporations that want to break up communities. You see a story like this and you can’t help but just really hope that there’s some positivity that’s going to come at the end of this very long, arduous sort of road.

Patrick Machel:

I started actually at Anchor as a bar back and worked my way up to a lead at the brewery itself is two different buildings right across from each other. So I know that bar pretty well. When they were getting pretty much murdered by the amount of people that were showing up, there’s a line around the block for pretty much two and a half weeks straight that I was there as auxiliary to pretty much customers would ask them questions. And they’re trying their best to get as much beer and as much merch out as possible that they’re like, “I can’t answer these fucking questions. It’s too much.” Well, I was there helping out and answering questions to people. It is.

There’s this amount of community involvement now that it could be just because we’re closing that they might not ever see it again. But there’s a lot of people that I talked to that were just like, “Oh, I totally used to drink you guys, but I faltered off.” But now drinking it again, I forget how crisp and how actually solid this beer is. And it’s like that’s all that it was. It’s a pretty middle of the road dad type of beer. And it should have been marketed in that way that’s like, “Look, we’re not trying to be some crazy ass IPA, milkshake IPA kind of bullshit.”

We’re good at what we do because it’s what we’ve been doing for a century and almost a half. And that should have been marketed in that way to have people understand that this is why you want to drink this beer. And then on top of that, it’s like we’ve been in Potrero Hill for since ’65, I think. So we’ve been in that community for such a long time that even before I worked there, I was working at a coffee shop in the same neighborhood. I was able to watch that whole neighborhood change in just a short span of 10 years. The Anchor has always been there. It hasn’t changed at all other than adding that tapper, which we were a little late on that whole craze, but we’ve created a community there. And there were regulars there that they never went anywhere else. We became friends with them. I’ve seen kids grow up there.

I’ve been invited to dug out level seats with a regular at the Giants game. We were part of the community and we still kind of are. You walk around and in the city, people know you like, “Oh, you’re one of the Anchor guys.” You know what I mean?” I mean, I think the fact that we’re not going down without a fight and with all this doom scroll that San Francisco is in right now, that it’s pretty poetic that this place that is a majority of people are multiple generations, San Franciscan here, that we’re not going down without a fight. We’re not going to be part of the headlines like you guys think that we will be.

Mel Buer:

Right. That’s about it that I have for my questions. Do you guys, either of you have any final thoughts, things that you want my audience to really take away from this conversation that maybe we haven’t touched on?

Patrick Machel:

Social medias, if you want me to plug those, I don’t know.

Mel Buer:

Sure. Yeah.

Patrick Machel:

So Twitter is where we’re releasing a lot of the news that we get because it’s pretty hard to try and release it on every platform all the time, and you don’t want to be like stale. You know what I mean? But our Twitter is Anchor Union SF. Our Instagram is Anchor Union. Our Gmail is Anchor Union at Gmail, and our Facebook is Anchor Union. So it’s pretty, “Uh-oh, there it goes. He he’s out.” So those are those. And then on top of that, we’re very proud of what we do. And even if this kind of falls through the fact that we were able to put our name in there and actually do it and try as a message to everybody else that has this happen, if you really care about your workplace, organize your workers and work together to come.

I mean, it’d be sick to buy your own business, but also just organize yourselves to get a better equality? What is it? A better wage, better life. There we go. We’re very proud that we were union.

Mel Buer:

Right. And hopefully that can continue with this coop. Hopefully you are successful. For our listeners who are interested in the updates of this ongoing sort of saga about trying to buy Anchor Brewing from the corporate Giant, the Twitter account is the way to go. That’s all the time we have today. Thank you so much for joining us, and I really appreciate you taking the time to speak with me. I think this is a fantastic story. I currently live in Los Angeles and I’m heading up north at the end of the week, so I’ll be in your neighborhood for a good weekend.

Patrick Machel:

Sick.

Mel Buer:

Yeah, I’m excited. It’s for Cal Extreme is where I’m headed up to Northern California. It’s a pinball expo.

Patrick Machel:

I was going to say, if you’re up there on the 26th, Enterprise Brewing is releasing the first Solidarity Ale.

Mel Buer:

Well, hey, I’ll make a note of it in our show notes so that folks know that that’s going to happen. That’s it for us here at the Real News Network podcast. Once again, I’m Mel Buer. Follow us on your favorite social media and don’t forget to subscribe to our newsletter so we can continue bringing you independent ad-free journalism. Until next time.

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