Beer Keeps Flowing at Somerville Brewing Company Following Bankruptcy Filing

Somerville Brewing Company filed for Chapter 11 bankruptcy protection with the United States Bankruptcy Court in the District of Massachusetts on September 27, requesting an emergency hearing with the court in order to continue with normal business operations.

The filing stated that the brewery was experiencing cash flow shortages and had fallen behind on its rent payments for its taproom at Assembly Row in Somerville. (It also has an older brewery and taproom elsewhere in Somerville, at 15 Ward Street. The Assembly Row location opened in late 2017.) The buildout of the Assembly Row taproom caused the cash flow shortages, according to the filing.

The emergency hearing took place on October 2. Somerville Brewing Company requested a judge’s approval to use its cash on hand and equipment to continue its brewery and taproom operations and to pay its employees and vendors.

According to court documents, United States Bankruptcy Judge Frank J. Bailey allowed Somerville Brewing Company’s motions to use its cash collateral and to pay its employee’s wages. The order allows Somerville Brewing Company to continue operations through November 4, 2019, on which there is another hearing to decide its future.

Somerville Brewing Company co-founder and co-owner Caitlin Jewell told Eater via email that “operations continue as normal, and we would be delighted for guests to visit.”

Somerville Brewing Company would have been forced to shut down if the court didn’t allow it to use its cash collateral and equipment to continue normal operations as it reorganized, according to its filing, which also indicates that Somerville Brewing Company has $33,482.85 in cash on hand, $3,966.75 of accounts receivable, and $640,075 of equipment and inventory. The filing indicates that Somerville Brewing Company owes $1.2 million to creditors and has a number of liens on its properties.

The brewery attempted to refinance its debts and attempted to reach a new rental agreement with its landlord at Assembly Row, according to the filing; however, both attempts were unsuccessful.

The court’s allowance means that Somerville Brewing Company currently remains fully in operation. It’s a win for local beer aficionados, who recently got bad news about another local brewery: Mystic Brewery will close later this month in Chelsea.

• Somerville Brewing Company Files for Chapter 11 Bankruptcy [BRT]