The Early 20th Century–
Overcoming the Challenge of Prohibition

By the early 20th century, Labatt was a corporation. Shares in the business were distributed among John Labatt’s seven daughters and two sons. At this time, in both the U.S. and Canada, a growing challenge for Labatt and other alcohol producers was the threat of prohibition – laws forbidding the manufacture and sale of alcohol.

Prohibition in Canada began in 1915, when public bars were banned in Saskatchewan. A year later, prohibition was instituted in Ontario, affecting all 64 breweries in the province. While some provinces totally banned the manufacture of alcohol, distribution and sales, many allowed for the production of beer for export to the U.S.

Labatt survived by producing full-strength beer for export south of the border and by introducing two “temperance ales,” (brews with less than two per cent alcohol) for sale in Ontario.

John S. Labatt is Kidnapped

The 1934 kidnapping of John S. Labatt also had a hand in shaping the company’s future. Nabbed by gangsters in Lambton County, Labatt was held for three days and then released unharmed at Toronto's Royal York Hotel. The experience made John somewhat of a recluse.

As a result, Hugh MacKenzie emerged as an important figure in the company’s history – first as comptroller, then as sales manager and later, general manager. MacKenzie was a savvy businessman, leading Labatt out of the Depression, through the Second World War and into a period of rapid expansion.

With the issuance of 900,000 shares in 1945, Labatt became a publicly traded company, creating new opportunities for raising capital. Labatt’s 1946 purchase of the Copland Brewery in Toronto, its first outside London, spawned the beginning of a brewing empire and marked the company’s first step toward becoming a national brewer.