From the Bavarian Brewing Co.
Various corporate documents and internal communications from Bavarian Brewing Co. were obtained, as presented below.
BAVARIAN'S AUDITOR'S REPORT IN 1917
Companies a century ago needed to comply with certain accounting standards and be subject to an auditor's review, in a similar way as they do today. Some of the pages from Bavarian's auditor's report are shown below. The report was dated February 16th, 1918, and reflected operations through the entire calendar year of 1917, with occasional comparisons to the year before. It contains documents that reflect much higher prices for the ingredients use in beer during WWI, and provide an interesting glimpse of the profitability and costs of the brewery at that time. After the cover page, the second document indicates a reduction in the profitability of the brewer from $137,806 in 1916 to $105,187 in 1917. This was primarily attributed to the increased costs of grains and other materials as U.S. entered WWII in 1917, as shown in the third document. It indicates the average cost to produce a barrel of beer increased from $1.97 to $2.92. The inflation occurring at that time was steeper than at anytime in the past century . It represents a cost increase per barrel of beer of about 50%, in just one year. And other prices nearly doubled in a year, such such items as malt, (corn) grits and fuel/supplies. The fourth item provides a breakdown of some of the prices attributable to the inventory on hand. Of interest, is the the listing of the labels, which indicates the brewery produced five beverages: 1) (Riedlin) Select (beer), 2) Bavarian (beer), 3) Bock, 4) Malt Tonic, 5) Ale and 6) Porter. Also of note is that bottles of amber, green and clear were used.
In 1932 a stock offering was proposed to reopen the Bavarian Brewery the following year when Prohibition would be repealed. The cover of this solicitation is shown on the right. This offering was signed by L. S. Deglow, an architect and family member of the original founder, Julius Deglow, as President of the Bavarian Brewing Co. The entire 4-page document is available here. Evidently, this offering was never fully subscribed and the brewery was undercapitalized when it reopened a couple years later in 1935.
BAVARIAN'S OWNERSHIP AFTER PROHIBITION
Capital to operate a brewery was done through direct investments of wealthy individuals or families, but it was also often raised though public or private stock offerings. The smaller breweries that had public offerings were not traded on major exchanges, but simply on curb exchanges and the stock could be purchased at certain investments firms. Raising such funds in the early 1930s after the stock market collapse in October, 1929, would have been challenging. Bavarian was one of several other local Cincinnati breweries that had offered stock in its company in order to reopen after Prohibition.
This stock certificate was issued to Murray Voorhees on July 25, 1933, and indicates the brewery was incorporated in Delaware. Interestingly, there was obviously some anticipation to open the brewery before Prohibition ended in 1933, as the corporate seal is dated 1932. However, the brewery didn't open until a couple years after this certificate was issued. When the brewery did open Murrary Voorhees, not Julius Deglow, was President. Apparently, the wife of Murray Voorhees, who was the granddaughter of the brewery's founder, became a major lender and investor in the brewery.
Notices of Stock Available in
Local Cincinnati Breweries
Offering notices for Bavarian Brewing Co. common stock in the summer of 1933 were placed in newspapers in Cincinnati, Indianapolis, Wilmington, DE and other cities. Other breweries were also trying to raise capital at the same time, as shown in one of the ads. The Bavarian offering was considered "speculative" and it was apparently difficult for Bavarian to obtain capital at that time. Please scroll through the notices on the right.
BAVARIAN'S CORPORATE DOCUMENTS
Bavarian Brewing Co. fell into receivership in mid-1937 and was sold out of bankruptcy in December, 1937. The brewery was sold to the son-in-law of the founder, William C. Schott, and three of his brothers, including their family members. These four men served as the initial Board of Directors of Bavarian Brewing Co. Documents that established the Bavarian Brewing Co. under the Schott Brothers are provided below. In addition, the corporate minutes during the operation of the brewery have also been retained.
Articles of Incorporation
After it the brewery fell into bankruptcy, it needed to be incorporated under its new ownership. On the right is a document the certifies the filing of the Articles of Incorporation for Bavarian Brewing Co. by the state Kentucky on January, 26th, 1938. Formerly, the brewer had been incorporated in the state of Delaware. Please view the actual Articles of Incorporation, established a few days earlier on January 21, 1938, or the By Laws, established on January 26, 1938.
For more information about the family that acquired the brewery, please see History: Schott Family Years.