Since the opposition party in Sweden won the election earlier this week, speculation surrounding a possible sale of Vin & Sprit has intensified. As the second ranking premium vodka in the world and second in the U.S. with 10% share, Absolut spawns over half of the company’s sales and sold 9.3 million cases in 2005.
According to UBS, Pernod, Fortune Brands, Brown-Forman, Bacardi, Constellation and Anheuser-Busch are all possible candidates if the company does go for sale. Diageo would likely be prevented because of anti-trust issues due to Smirnoff’s 27% global share. Both Pernod and Fortune Brands remain “relative geared†after the Allied acquisition, but Pernod would probably have to relax its Stolichnaya distribution if it were truly interested.
V&S could go for $3-4 billion according to the Independent Sun.
However, the Maxxium distribution joint-venture remains a key issue for V&S, given exit penalties that could range between €80-160 million. In that respect, Fortune Brands has the advantage as it is among the four jv partners, also including Remy Cointreau and The Edrington Group, in which each party owns a 25% stake in Maxxium. Fortune also distributes Absolut in the U.S. and Europe.
