Thursday 11 October 2012

Grätzer Breweries

I've officially ceased to be amazed at anything I find. This one really takes not just the biscuit, but the whole tin of jaffas, digestives and rich teas. Yes, British investors tried to buy all the breweries in Gratz and get a monopoly of Grätzer Bier.

I'm mostly amazed that anyone in Britain knew what the hell Grätzer was. That they should try and get a monopoly in it is just par for the 19th century course. That's what raw, naked capitalism was all about. And capitalism doesn't come much rawer than in 19th-century Britain.

"The LISTS of APPLICATIONS will CLOSE on or before THURSDAY, the 26th day of July, 1888,
Purchase of all the breweries at Gratz, near Posen (five in number), thus giving a practical monopoly for the sale of the well-known Gratzer beer, a speciality peculiar to Gratz, and brewed in no other part of Germany.

All the Breweries and Properties are Freehold.

Annual sale of beer over 1,800,000 gallons.

Notwithstanding strong competition amongst the owners of the breweries, the average annual profit for the last three years, as certified by the accountants, amounted to £21,238. which, after deducting the interest on Debentures and Preference Shares, leaves sufficient to pay a dividend of 14 per cent, and in addition a sum of £2,338 per annum.

Incorporated under the Companies Acts, 1862 to 1886. Share capital £160,000, divided into 16,000 Seven per Cent Cumulative Preference Shares of £5 each, £80,000; 16,000 Ordinary Shares of £5 each, £80,000. First issue, 14,000 Seven per Cent Cumulative Preference Shares of £5 each, £70,000; 15,000 Ordinary Shares of £5 each, £75,000. Payable 10s. per share on application. £2 per share on allotment, and £2 10s. on August 16, 1888. In addition to the above shares, £70,000 Five per Cent Debentures are offered for subscription, redeemable, at the company's option, in 20 years, at £105, payable £10 per cent on application, £40 per cent on allotment, and £50 per cent on August 16, 1888.

Trustees for the Debenture Holders.
The Trustees, Executors, and Securities Insurance Corporation Limited, Winchester House, Old Broad-street, E.C.
Robert Curzon, Esq., Colchester, Director of Daniell and Sons' Breweries Limited.
Charles Horsley, Esq., of Messrs. Mountain, Horsleys, and Co., hop merchants, Southwark-street. S.E.
Major H. W. Scriven, of Messrs. Paley, Scriven, and Co., 34, Great St. Helens, E.C., Chairman of Gilman and Spencer Limited, brewers.
Henry Stopes, Esq., Cintra Park, Upper Norwood, S.E., Director of Colchester Brewing Company Limited,
*Herr Otto Bahnisch. Proprietor of the Bähnisch Grätzer Brewery (Managing Director).
*Herr Otto Grünberg, of the Grünberg Grätzer Brewery.
*Herr A. Herzfeld, President of the Grätzer Town Council and a Magistrate.
*Will join after allotment and form a Local Advisory Board.

Messrs. Brown, Janson, and Co., 32, Abchurch-lane, E.C.
Herr Heimann Saul, Posen.
Herren Marcus Nelken and Son. Berlin and Breslau.

Messrs. Henry Pawle and Co., 13, Copthall-court, E.C.

Solicitor.—W. Capel Slaughter. Esq., 18. Austinfriars, E.C.

Auditors. Messrs. Monkhouse, Goddard, and Co.. chartered accountants, St. Swithin's-lane, E.C.

Secretary (pro tern.)— Mr. G. H. Dixon.
Registered Office. 10, Queen-street-place, Cannon-street, E.C.

This company is formed to purchase and amalgamate the five well-known Freehold Breweries at Grätz, in the Province of Posen, together with the goodwill, the lands, buildings, maltings, plant, machinery, materials and utensils, horses, vans, and every description of appliance necessary for the carrying on of a brewing business on a large scale, and also the branches established at Berlin, Posen, and Bromberg, including horses, carts, plant, fixtures, &c.

There are qualities in the water at Gratz, used in making this beer, which have, for a long time past, justified medical men in recommending the use of Gratzer and it is highly appreciated throughout Germany; in fact, so well known is it in North Germany, that the "Gratzer Goblet," a specially designed glass, is in general use in Hotels, Restaurants, Cafes, and Railway Refreshment Rooms throughout the country.

Mr. H. Stopes, whose exceptional experience in all matters connected with brewing gives especial value to his opinion, has, before consenting to join the board, personally inspected the five Breweries, and his report, which accompanies the prospectus, is of the most favourable character. In it he states:—

"Taking into consideration the whole special character of the business of these Breweries, the number, nature, and position of the properties, and plant and rolling stock included in the purchase, and the possession of the monopoly of so well-known and rapidly increasing a trade as that in Grätzer Beer, the prices and terms fixed in the prospectus submitted to me are fair and reasonable, and with proper management the business should develop into one of considerable prosperity and success.

"The present trade of over 50,000 barrels per annum can very readily be increased, and the cessation of all competition, coupled with the simplest, cheapest, and most lucrative form of brewing I have yet seen in any country, makes successful working as much a certainty as can be expected in a commercial undertaking."

The accounts for the past three years have been examined by Messrs. Monkhonse, Goddard, and Co., 28 and 29, St. Swithin's-lane, E.C., and Mr. W. E. Pearse, 10, Queenstreet-place, E.C., chartered accountants, and in their report they detail the steps they have taken to enable them to certify a profit of £21,258 per annum for the five Breweries.

A copy of the joint report of the accountants accompanies the prospectus, and the original can be seen at the office of the solicitor. This certified profit gives the following result:—

Average profit for the last three years (without taking into account the profits derived from the branches on the Bottling and Retail Sales) 
£21,238 0 0 
Deduct annual interest on £70,000 Debentures at 5 per cent  £3,500 0 0 
Annual Dividend on £70,000 Preference Shares at 7 percent  4,900 0 0 

8,400 0 0 
Leaving a Balance of 
£12,833 0 0 

Whilst it will only require £10,500 per annum to pay a dividend of 14 per cent on the £75,000 Ordinary Shares now issued. The vendors pay all the expenses attending the formation of the company up to allotment, including brokerage.

In case no allotment be made the deposit will be returned in full, and if a smaller number of shares be allotted than are applied for, the money paid on deposit will be applied towards further payments.

Full prospectuses and forms of application can be obtained of the bankers, brokers, aud solicitor, and from the secretary, at the office of the company.
London, July 18,1888.

The following table shows the dividends paid on, and the value on the 16th July , 1888, of the shares of some German breweries, from which it will be seen that this class of investment returns a highly profitable rate of interest to the original investor, and is held in high estimation in Germany :—

Dividend 1886.  Dividend 1887.  Price Per Cent. 
Böhmisches  12.5 14 296.5
Dortmunder  20 23.33 342
Dortmunder Union  15 18 267
Friedrichshain 10 10 205
Leipzig Riebeck    10 202
Lindener  26.67 28.67 366.75
Patzenhofer  43.33 53.5 630.5
Schultheiss  14 14 294.25

The directors of the St. Pauli Breweries Company, of Bremen, which was incorporated as an English company in January last, have recently declared an interim dividend for the half-year on the Ordinary Shares at the rate of 12 per cent per annum, and the shares are now quoted as follows: —
£10 Ordinary Shares, fully paid             £15 15 0
£10 Seven per Cent Preference Shares, fully paid      12 10 0 "
Manchester Courier and Lancashire General Advertiser - Wednesday 25 July 1888, page 1.
You may be wondering why I've suddenly returned to Grätzer. There's a good reason. Which you may be able to guess. Otherwise you'll have to wait until I tell you.

50,000 barrels isn't a huge amount of beer. It's a sign that, in terms of renown, Grätzer definitely punched above its weight.  That's if it's true that it was sold in pubs and refreshment rooms across North Germany. You always have to approach claims in a prospectus with a healthy degree of cynicism. I always keep this in the back of my mind: they're trying to prise your money out of you.

One thing I noticed about the locals who were to join the board: all had German names. I know from Bohemia that you have to be really careful with jumping to too many conclusions from names. In Bohemia the same individual would use German and Czech versions of their name, depending on the circumstances.

Interesting to know that they employed the "simplest, cheapest, and most lucrative form of brewing". Would have been even more interesting if a few details of the brewing method had been provided. Can't have everything, I suppose.

Thanks to Bailey for putting me on the trail of this story.


Maciej Wojtkowiak said...

Grodziskie beer, brewed by Poles was pretty famous in Central Europe. Brewers from Grodzisk exported it to all Poland and Prussia, Brandenburg and Silesia as well.
Prussian partition of Poland occurred from 1793 to 1918. Invaders changed the name of our city to Gratz and step by step bought Polish breweries in Grodzisk. In the end on 19th century Prussian Settlement Commission increased German settlement and financial support for German owned businesses. Poles were prosecuted but still there was few Polish breweries in Grodzisk that time. Wrren and Windsor wanted to buy breweries owned by Germans: Bahnisch, Grunberg, , Habock & Bohnstedt and one Polish brewery owned by Bibrowicz. Next days I will send you an e-mail with English text about history of brewing in Grodzisk :)

Ron Pattinson said...


I'd wondered why all the brewery owners had German names. Now it makes sense.

Do you know what happened with the attempt to buy all the Grodziskie breweries?