Fortune has eyes for Absolut - Sweden to privatize vodka manufacturer
Fortune has eyes for Absolut - Sweden to privatize vodka manufacturer
By John Schmeltzer, Tribune staff reporter Tribune news services contributed to this report
Copyright © 2007, Chicago Tribune
Published June 21, 2007
Moving swiftly to stake out its position, Fortune Brands Inc., the largest liquor company in the U.S., said it is the best partner for the maker of Absolut Vodka after the Swedish parliament on Wednesday approved privatizing the company.
The parliament, in a 146-121 vote, decided to privatize six companies, including the liquor group Vin & Sprit AB, which produces Absolut. Deerfield-based Fortune Brands has been a partner with the Swedish company for the past seven years.
"We believe that making the partnership we share with V&S permanent would be good for both companies," said Norman Wesley, chairman and chief executive of Fortune Brands.
Vin & Sprit acquired a 10 percent stake in Fortune Brands' Beam Global Spirits and Wine division seven years ago. The two firms previously jointly formed a global distribution company, and they are partners in a firm that distributes Absolut in the U.S. Vin & Sprit could fetch as much as $5.7 billion, according to some estimates.
The Swedish government has said three other liquormakers have expressed an interest in acquiring the firm.
It said the group includes the world's largest liquormaker, London-based Diageo PLC, and the second largest, Paris-based Pernod Ricard SA. The government has said that Bahamas-based Bacardi Ltd. also has expressed an interest in bidding for the firm.
Wesley said Fortune Brands offers the Swedish company and its employees the best chance for continuing operations uninterrupted.
"As a partner and not a competitor, we believe Fortune Brands is in a unique position to maintain the momentum of V&S, protect the heritage of the brands and preserve jobs in Sweden," said Wesley.
"Given the fact that our brands are already distributed together around the world, there would be no antitrust risk to combining our companies."
Sweden's previous government opened up state-owned companies for private ownership in the 1990s but maintained a strong influence by keeping large share holdings.
The government's stakes in the six companies are worth about $35.52 billion. The government wants to use the proceeds of the sales to pay off the national debt.
Some Swedes fear foreign owners will take over companies like Absolut and move jobs abroad.
An opinion poll published Wednesday in a Swedish newspaper showed 49 percent opposed the sale, 28 percent supported it and 23 percent were undecided.
"Combining our companies would be a natural step forward that we believe would create value for the Swedish government, for the V&S workforce and for our shareholders," Wesley said.
Approval of the sale, which was expected, gave the government the go-ahead to sell three unlisted companies -- real estate group Vasakronan AB, mortgage company SBAB and Vin & Sprit -- and three companies listed on the Swedish stock exchange: telecommunications operator TeliaSonera AB, banking group Nordea AB and stock market operator OMX AB.
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jschmeltzer@tribune.com
By John Schmeltzer, Tribune staff reporter Tribune news services contributed to this report
Copyright © 2007, Chicago Tribune
Published June 21, 2007
Moving swiftly to stake out its position, Fortune Brands Inc., the largest liquor company in the U.S., said it is the best partner for the maker of Absolut Vodka after the Swedish parliament on Wednesday approved privatizing the company.
The parliament, in a 146-121 vote, decided to privatize six companies, including the liquor group Vin & Sprit AB, which produces Absolut. Deerfield-based Fortune Brands has been a partner with the Swedish company for the past seven years.
"We believe that making the partnership we share with V&S permanent would be good for both companies," said Norman Wesley, chairman and chief executive of Fortune Brands.
Vin & Sprit acquired a 10 percent stake in Fortune Brands' Beam Global Spirits and Wine division seven years ago. The two firms previously jointly formed a global distribution company, and they are partners in a firm that distributes Absolut in the U.S. Vin & Sprit could fetch as much as $5.7 billion, according to some estimates.
The Swedish government has said three other liquormakers have expressed an interest in acquiring the firm.
It said the group includes the world's largest liquormaker, London-based Diageo PLC, and the second largest, Paris-based Pernod Ricard SA. The government has said that Bahamas-based Bacardi Ltd. also has expressed an interest in bidding for the firm.
Wesley said Fortune Brands offers the Swedish company and its employees the best chance for continuing operations uninterrupted.
"As a partner and not a competitor, we believe Fortune Brands is in a unique position to maintain the momentum of V&S, protect the heritage of the brands and preserve jobs in Sweden," said Wesley.
"Given the fact that our brands are already distributed together around the world, there would be no antitrust risk to combining our companies."
Sweden's previous government opened up state-owned companies for private ownership in the 1990s but maintained a strong influence by keeping large share holdings.
The government's stakes in the six companies are worth about $35.52 billion. The government wants to use the proceeds of the sales to pay off the national debt.
Some Swedes fear foreign owners will take over companies like Absolut and move jobs abroad.
An opinion poll published Wednesday in a Swedish newspaper showed 49 percent opposed the sale, 28 percent supported it and 23 percent were undecided.
"Combining our companies would be a natural step forward that we believe would create value for the Swedish government, for the V&S workforce and for our shareholders," Wesley said.
Approval of the sale, which was expected, gave the government the go-ahead to sell three unlisted companies -- real estate group Vasakronan AB, mortgage company SBAB and Vin & Sprit -- and three companies listed on the Swedish stock exchange: telecommunications operator TeliaSonera AB, banking group Nordea AB and stock market operator OMX AB.
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jschmeltzer@tribune.com
posted by Carlos T Mock @ 7:38 PM
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