Time called on Cains beer brewing over royalties dispute

The brewing of Liverpool’s iconic Cains beer has stopped, due to a dispute over a royalties clause, which has led to the redundancies of two of the company’s three brewers.

Almost a year ago it was announced that the iconic Liverpool brew would make a return to bars around the city after St Helens-based leisure business Mikhail Hotels & Leisure Group struck a deal with brand owner, Terracotta Asset Management, to revive some of the most popular ales.

Cains dates back to 1850 and was revived in 2002 when brothers Sudarghara and Ajmail Dusanj bought the business.

They introduced a popular range of around 10 different brews, but the venture collapsed into administration in the financial crash of 2008.

The Dusanj brothers bought back the Toxteth-based red brick brewery and eight of the original pubs, but brewing came to a halt again in 2013 and, despite plans to relaunch as a microbrewery, the brand had lain dormant.

However, production began in earnest once more, and Cains returned to bars around the city in June last year following the deal between Mikhail, which has invested millions of pounds on the Cains Brewery redevelopment, as the Cains Brewing Company.

But now time has been called, with production being halted after lawyers were instructed in a row between the two parties over the interpretation of a royalty clause linked to beer production volumes.

A Mikhail spokesperson confirmed to TheBusinessDesk.com: “We have stopped brewing, and the reason is because there is a royalty agreement in place.

“The royalty agreement has a definition, or a method of calculating what that royalty is. We disagree on the interpretation of that definition.”

They added: “Terracotta’s interpretation is not my interpretation of it. I categorically don’t believe that interpretation is what is in the agreement.”

They said if Terracotta believes its interpretation, the viability of Mikhail’s Cains business is “not worthwhile”.

While the legal teams lock horns over the dispute, the business has had to let staff go.

The Mikhail spokesperson said: “We had a team of three brewers, two of which have left the business, directly as a result of this.

“They left last week, but fortunately I believe they have got other jobs.

“They have been fantastic. I couldn’t have asked for more from the team of brewers. They got awards for the bitter within two or three months of brewing. They couldn’t have done any more in terms of the quality of the product.

“The most disappointing part is the impact on the staff.

“I feel sorry for those lads because they don’t deserve it. At this time with what’s going on in the world, with the cost of living crisis, it’s difficult for people.

“The team had worked tirelessly, volumes were increasing and the brand was starting to live again, the fact the brand has ceased again is no reflection on the team we had assembled, I can only thank them for their efforts.”

Terracotta Asset Management was contacted by TheBusinessDesk.com but declined to comment.