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In Response To New State Law, Anheuser-Busch Sells Kentucky Distributors

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No longer permitted by state law to own a distributorship in Kentucky, beer company Anheuser-Busch has transferred ownership of its distributors in Louisville and Owensboro to a Texas company.

And with that, the so-called Kentucky beer battle has come to a close.

Anheuser-Busch announced the transfer of the two Kentucky distributors to  Standard Sales Company on Tuesday.

During the Kentucky General Assembly session earlier this year, a group of craft brewers and distributors successfully lobbied legislators to close a loophole in the state’s alcohol laws that permitted out-of-state breweries to own their own distributors.

According to state law, brewers, distributors and retailers are required to be separate entities. But because of the loophole, beer giant Anheuser-Busch, maker of Budweiser, had owned a distributorship in Louisville since 1978 and an Owensboro distributorship since 2014.

The craft beer group, called Kentuckians for Entrepreneurs and Growth, or KEG, argued that the law gave Anheuser-Busch an unfair advantage. The state legislature and Gov. Steve Beshear agreed; the governor earlier this year signed a bill that closed the loophole into law.

During the legislative session, representatives from Anheuser-Busch warned that the bill would force the company to shutter its two Kentucky distributors and lay off hundreds of workers.

It’s unclear if any employees will lose their jobs. But the distributorships will not close, according to a statement released Tuesday evening.

The deal also includes the transfer to Anheuser-Busch of distributorships in Colorado and the purchase of another distributor.

“After a significant evaluation of options, we agreed to exchange territory with Standard Sales as the best path forward for our employees and operations in Kentucky, where we can no longer own a distributorship,” said Bob Tallett, Vice President of Business and Wholesaler Development with Anheuser-Busch.

In a statement, Standard Sales Company President Lanny Layman said that the company was “eager to meet the employees in Kentucky and to grow our business there.”

Another casualty of the beer bill was Rhinegeist Brewing, a craft beer maker based in Cincinnati. In late 2014, Rhinegeist opened up a craft beer distributorship in Kentucky. Company president Bob Bonder has said the distributorship would have to be closed due to the new law.

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