Posted on: Saturday, January 19, 2002

C. Brewer to sell 70,000 Big Island, Maui acres

• C. Brewer & Co. holdings on Maui, Big Island

By Andrew Gomes
Advertiser Staff Writer

Hawai'i's oldest continuously operated business, C. Brewer & Co. Ltd., yesterday began the process of liquidating its largest remaining asset following last year's sale of most of the Hilo-based company.

C. Brewer hopes to find a buyer or buyers for 70,000 acres of primarily agricultural land on the Big Island and Maui. The property comprises several hundred parcels representing 1.7 percent of the state's total land mass — roughly the equivalent of one-fifth the size of O'ahu.

The land has been in the C. Brewer family for 140 years, and for most of that time was used to grow sugarcane. It has an estimated value of $200 million as a whole, and more if sold separately.

Selling the property will take C. Brewer one step closer to dissolution, ending more than 175 years of business for the storied company. It also will create a major redistribution of land ownership in the state, and if sold in bulk would be one of the largest Hawai'i property transactions in history.

"It is a time of change for C. Brewer & Co.," said Alan Kugle, chief executive officer of real estate for the sixth-largest private landowner in Hawai'i. "We're offering all of our real estate for sale at one time in bulk."

Handling the sale will be Honolulu-based commercial real estate firm CB Richard Ellis Hawaii Inc., which is marketing about 67,000 acres on Maui and the Big Island. Hilo-based Prudential Orchid Isle Properties is listing another 3,000 acres on the Big Island.

The land is concentrated in three areas: Ka'u (31,000 acres, including eight miles of shoreline); Hilo to Hamakua (19,000 acres, including the land surrounding 'Akaka Falls); and Wailuku (20,000 acres, including land in and around '?ao Valley).

Kugle said hundreds of C. Brewer lessees, including small farmers and large companies, will be given the first opportunity to buy.

Already having expressed an interest, he said, have been Alexander & Baldwin and Maui Land & Pineapple, both of which lease C. Brewer land. The Nature Conservancy also has expressed interest in some of the roughly 20,000 conservation-zoned acres.

But Kugle said the company would prefer to sell its holdings as one. "We are hoping that a Hawai'i company or organization will purchase the properties as a package," he said.

Proceeds will go to about 80 company shareholders, many of whom participated in a $202 million leveraged buyout in 1986.

Most, including former executives, are now in their 70s, and want to cash out for estate planning purposes. But it has been hard to sell or trade their privately held stock. It was also tough to sell the company to a single buyer because of its diverse operations.

Following 15 years of taking no dividends and making strategic divestitures including Hawaii Coffee Co. Inc., Mauna Loa Macadamia Nut Corp. and Ka'u Agribusiness Co. Inc., shareholders last year had eliminated roughly $195 million in debt used in the buyout, then received a $51 million distribution of company cash.

Late last year, in a deal valued at more than $10 million, C. Brewer Chairman J.W.A. "Doc" Buyers purchased nearly all of the company's remaining businesses, including frozen-juice subsidiary Hawai'i's Own Corp., Wainaku Executive Center, a Kaua'i guava orchard and processing plant, the management company for ML Macadamia Nut Orchards LP and about 200 acres along the Hamakua Coast.

The company plans to sell its remaining assets — Big Island trucking company HT&T, a sweetbread factory, Food Quality Lab and the 70,000 acres — within two years. C. Brewer will then be dissolved.

C. Brewer was one of the original "Big Five" companies that dominated commerce in Hawai'i for more than a century, and the oldest of those firms still operating in the state.

Originally a trading company when it was founded in 1826, C. Brewer got into whaling, sugar, macadamia nuts, agriculture consulting, real estate, power generation, stevedoring, trucking, nutraceuticals and other industries.

Reach Andrew Gomes at agomes@honoluluadvertiser.com or 525-8065.