CHICAGO -- One of the nation's most venerable brewers, G. Heileman Brewing Co., has become the latest victim of the widespread use of debt in the 1980s.
Heileman, which has a brewery in Baltimore County, filed yesterday in New York City for protection from creditors under Chapter 11 of the Federal Bankruptcy Code.
The company was unable to make payments on the mountain of debt piled onto its balance sheet when it was taken over in 1987 by Alan Bond, an Australian entrepreneur.
Heileman's brands are Colt .45 and Champale malt liquors, Old Style and Black Label beers and La Croix sparkling water.
The 133-year-old company also has breweries in La Crosse, Wis.; San Antonio, Texas; Portland, Ore.; and Seattle.
Heileman executives, seeking to play down the impact of the filing, said yesterday that the company, based in La Crosse, would continue operating normally with all of its breweries and employees.
They said they had a plan that could allow Heileman to emerge from bankruptcy as early as summer.
They also noted that Heileman, the nation's fifth-largest brewer, recently recorded its best quarterly profits in three years despite being overwhelmed on advertising, promotions and other marketing by the two Goliaths of the beer business: the Anheuser-Busch Cos. and Miller Brewing Co.
The smaller breweries, Adolph Coors Co. and the Stroh Cos., also outrank Heileman.
A company spokesman, Don Durocher, said the bankruptcy filing will have no impact on the Halethorpe brewery in Baltimore County or on its more than 400 employees. The filing was made to allow the company to reorganize its debt, not because it was losing money from operations, he said.
"There is no need to lay off people or close plants or tighten up budgets, because they are already profitable in their operations," Mr. Durocher said.
Beer analysts were not nearly as upbeat.
For one thing, they said, the bankruptcy filing would be the start of a nasty struggle by Heileman's secured bank lenders to protect their loans by forcing the company's unsecured lenders to take total losses.
"It's bankruptcy in the 1990s," said Tom Pirko, the president of Bevmark Inc., a Los Angeles-based industry consultant.
"If you're a bank that has lent to one of these highly leveraged companies, one of the first things you do in a bankruptcy to streamline the company is try to stiff the unsecured creditors."