Brown Jug stores sold to Canadian company

July 22, 2008 at 1:47PM AKST

The largest independent chain of liquor stores in Anchorage has been purchased by a Canadian company.

Liquor Stores Income Fund of Edmonton, Alberta, signed an agreement to acquire all19 liquor stores owned by Brown Jug, according the Web site Quote.com. The acquisition is subject to completion of due diligence, customary closing conditions, and regulatory approvals. Closing is anticipated to take place by December 2008.

Brown Jug and its predecessors have been in the liquor retailing business in greater Anchorage for more than 50 years. In Alaska, there are reportedly 378 retail liquor outlets and approximately 88 stores in the greater Anchorage area. The fund’s managers say Brown Jug's sales represent about a 20 percent market share. The state of Alaska is said to have a favorable regulatory environment, limiting the number of stores in the state to 1 per 3,000 people in urban areas.

"We are very pleased with the planned acquisition of the Brown Jug stores as our initial entry into the U.S. market, as well as the addition of our new Canadian stores,”  said Irving Kipnes, CEO of the fund. “Management estimates that the 19 Brown Jug stores will add in excess of 12 percent to current revenue levels in their first full year of operation.”

Liquor Stores Income Fund is a publicly traded Canadian income trust that participates in the retail liquor industry in Alberta, British Columbia, and Nova Scotia.