Goldsboro beer distributor taps out in record sale
Goldsboro’s Jeffreys family concluded it was closing time for their beer distributorship, prompting a sale that an industry expert says sets a national record for an Anheuser-Busch Cos. wholesaler.
In March, three N.C. companies bought exclusive area rights from R.A. Jeffreys Distributing Co., which started distributing A-B beers in 1923 and sold Budweiser and other suds to retailers throughout most of eastern North Carolina, including Greenville, Raleigh and Wilmington. Terms weren’t disclosed, but trade publication Beer Marketer’s Insights estimated the transactions totaled $350 million to $400 million, Publisher and Editor Benj Steinman says.
Jeffreys was the fifth-largest A-B wholesaler in the U.S., with operations in 36 N.C. counties, according to the company’s website. More than 600 people worked for the family-owned company led by President Robert Jeffreys, an heir of founder Zadloc Marquis Lafayette Jeffreys. Other owners included his sisters Leigh Jeffreys Fanning, a trustee at East Carolina University, and Ellen Jeffreys Bland, whose husband, Will, is an N.C. Superior Court judge in Goldsboro.
As part of the deal, Jeffreys’ territory was carved up by three closely held companies: Charlotte-based Adams Beverages of North Carolina LLC, Greensboro-based R.H. Barringer Distributing Co. and Rocky Mount-based Carolina Eagle Distributing Inc.
Barringer is picking up Wake County and some adjoining areas. Adams is gaining rights to much of the southeastern part of the state, including 23 counties ranging from Anson in the west to New Hanover and other coastal areas. Carolina Eagle acquired rights to seven eastern N.C. counties, including Nash, Pitt and Wilson.
Upon the deal’s closing, Adams dismissed several dozen salespeople and warehouse workers in Goldsboro, Lumberton, New Bern and other cities, according to four former Jeffreys employees. No severance was provided to the workers, including some who had worked for the Jeffreys’ business for nearly three decades, they say. The workers, who asked to remain anonymous to avoid difficulty in landing new jobs, say they were told last year that a pending sale wouldn’t affect their job status. Calls to Robert and Leigh Jeffreys and Adams’ owner Clay Adams weren’t returned.
Adams, which started distributing beer in Dothan, Ala., in 1937, acquired rights to the Charlotte market for Anheuser-Busch in 2012. With the Jeffreys’ purchase and a 2016 acquisition of a Shelby wholesaler, Adams now covers 28 N.C. counties.
For many years, the distributorship was led by George Jeffreys, a World War II veteran who was among Goldsboro’s most prominent leaders and philanthropists, Mayor Chuck Allen says. He was also known as an early investor in large tracts at Topsail Island and various businesses including a consumer-finance company. While officially retired for many years, George Jeffreys showed up at the Goldsboro office almost every day until his death at age 90 in 2016, according to several company workers. Jeffreys grew rapidly between 2007-10 when it bought five distributors, making it the state’s biggest A-B wholesaler with about 17 million cases sold annually, Steinman says. The biggest expansion was the purchase of Raleigh-based Harris Wholesale Inc. in 2011, prompting some administrative work to shift from Goldsboro to the capital city. “They were a big-time acquirer, so it’s a bit surprising that they decided to sell,” he says.
Jeffreys ranked No. 17 nationally among the biggest U.S. beer distributors, with estimated annual sales of $360 million, according to a 2014 survey by industry publication Beer Business Daily. It was the only N.C. company on the list.
The company had a setback in 2017 when a merger plan with two distributors in Georgia and South Carolina was rebuffed by A-B, which retains considerable power over its wholesalers. The deal would have created a three-state, 30 million-case business but was canceled after A-B sued in federal court, Steinman says.
According to a court filing, A-B said it had previously approved acquisitions that enabled Jeffreys to quadruple from 3.6 million cases to 16 million cases. The three-way arrangement would have led to excessive indebtedness, according to the beermaker.
Last June, sparked by A-B’s lawsuit involving Jeffreys, N.C. lawmakers passed a bill favored by wholesalers that limited brewers’ ability to block the sale of one distributor to another.
While the popularity of craft brewers has increased competition in the beer industry, A-B has responded by acquiring local and regional brands including Goose Island, Wicked Weed and Devils Backbone. The company’s share of U.S. beer sales exceeds 40%, while its parent, Belgium-based AB InBev, controls nearly 30% globally. ■