Owners of Shakers vodka file Chapter 7 bankruptcy petition
BENSON -- The company that put Benson on the map as a distiller of fine spirits and Shakers on store shelves as an ultra-premium vodka has filed a Chapter 7 bankruptcy petition.
The voluntary petition by Infinite Spirits Inc., of Blaine, was entered on the court docket Jan. 5 in U.S. Bankruptcy Court, Minnesota division. The first meeting of creditors was held Wednesday.
The five original founders of Pete's Wicked Ale launched Shakers Vodka in frosted bottles shaped like Martini shakers in March 2003. The vodka made from Minnesota-raised wheat won wide acclaim as America's answer to premium, foreign vodka brands. It also drew national attention to Benson, where it was distilled until last year.
The Chippewa Valley Ethanol Company had created Glacial Grain Spirits to distill the vodka.
Under the Chapter 7 petition, Infinite Spirits will be liquidated but there is the possibility that the Shakers brand could be purchased and continued, according to the court-appointed trustee for the petition, attorney Rick Stermer of Montevideo.
The bankruptcy is "disappointing'' news to Glacial Grain Spirits of Benson, but it will not adversely affect the local company, according to Mike Jerke, plant manager of Chippewa Valley Ethanol Company. Glacial Grain Spirits distilled the product under contract to Infinite Spirits. There is no ownership relationship between the two entities.
Glacial Grain Spirits currently distills Prairie Organic Vodka for Minnesota-based Phillips Inc., and also produces a variety of products for other customers.
"Shakers will always be near to our hearts as the company that started us off on the road in beverage production,'' said Jerke. "We're fortunate to have other customers as well.''
Shakers Vodka remains on stores shelves in many areas. There is some optimism that the brand could survive the bankruptcy proceedings.
"We are all hoping that the brand will survive this very tough period,'' said Pat Couteaux of Blaine, Shakers' distiller and one of the company's co-founders.
Couteaux ended his role with Infinite Spirits one year ago, but said he remains an active supporter of seeing the brand continue.
There has already been some interest expressed in purchasing the brand, its two patents and recipes, according to attorney Rick Stermer, the trustee.
In its bankruptcy petition, the company lists assets of $195,349 and liabilities of $2,255,856. Its physical assets are mainly bottling equipment and industrial storage tanks.
Stermer is hopeful that the interest in the brand and intellectual property will add value to the company's assets. As the trustee, his duty is to satisfy obligations to unsecured creditors as much as possible.
The possibility that the Shakers brand could be continued through a sale to another party is not unrealistic, according to the attorney representing Infinite Spirits, Thomas Flynn of Bloomington. He said he has also heard of interest in it.
Flynn attributes the company's financial demise primarily to the market conditions it faced.
Former directors with the company -- who would not speak on the record -- indicated there was dysfunction within the company in its final days as well.
Whether the company was the victim of market forces or dysfunction within it "depends on who you talk to about it,'' said one former director. "I've heard blame from all over the place.''
Bankruptcy records filed to date indicate that the company grew quickly from its launch in 2003 and posted annual sales over $1 million. At one point it marketed five products under the Shakers label, including wheat- and rye-based vodkas and seasonal versions known as rose, violet and summer.