Pernod Ricard buys maker of Absolut
Sweden’s famed Absolut vodka will become absolutely French -- in ownership at least -- after a successful $8.34-billion bid from Pernod Ricard.
The French spirits company agreed to pay the Swedish government $8.3 billion for Vin & Sprit, the maker of Absolut, outbidding three competitors.
Pernod Ricard also will assume $546 million in outstanding debt as part of the deal for Absolut, which was put on the auction block in a sell-off of state-owned companies.
“We wanted to bolster our presence in the U.S. and Absolut, with its 5 million cases, will definitely do that,” said Pernod Managing Director Pierre Pringuet, referring to Absolut’s annual sales in the United States.
“We intend to develop the brand and, if possible, accelerate its strengths,” he said.
The government said it selected Pernod Ricard’s bid over three other offers by liquor groups Fortune Brands and Bacardi Ltd. and an investment group controlled by Sweden’s Wallenberg family.
“All four presented well-prepared and very interesting proposals, but it was soon clear to us that Pernod Ricard’s bid was the best,” Sweden’s Financial Markets Minister Mats Odell said.
“It is a very good price for the company.”
The government said Pernod Ricard -- owner of Chivas Regal whiskey, Mumm champagne and Beefeater gin -- intends to keep Absolut in Sweden.
“There is no written contract about that but the value of the brand is because it is Swedish,” Pernod Ricard Chairman Patrick Ricard said. “A Swedish brand must be produced in Sweden.”
The government said the deal includes the whole company, except for Vin & Sprit’s 10% share in U.S. spirits company Beam Global Spirits & Wine, which would be sold under a previous agreement with Beam shareholders.
The deal will be completed this summer.
With its array of flavors including peach and black currant, Absolut is the premium brand of Vin & Sprit. The company’s other brands include Cruzan rum, Plymouth gin, a handful of Scandinavian aquavits and bitters and hundreds of wines.
