US/RUSSIA: CEDC accepts Roust Trading deal

By | 11 March 2013

CEDC is slowly ceding control to the owner of Russian Standard

CEDC is slowly ceding control to the owner of Russian Standard

The owner of Russian Standard is on course to take an 85% stake in Central European Distribution Corporation (CEDC), a week after SPI Group signalled a swoop for the debt-laden spirits maker.

CEDC said on Friday (8 March) it has agreed to Roust Trading's US$172m amended exchange offer tabled last week. Together with other moves, including diluting existing shareholders' stock to 5% of total equity, the offer will reduce CEDC's debt by about $635m, the company said.

The amended exchange offer expires on 22 March, CEDC said.

The news should interest SPI, who last Tuesday said it was considering a move for CEDC. The Luxembourg-based, Russia-originated company owns two sets of CEDC notes and claimed to be in talks with “a few strong financial players” in Russia over a deal. 

CEDC has been struggling with debt, resulting in the firm handing operational control to leading shareholder and Russian Standard owner Roustam Tariko last month in return for US$65m. Tariko also owns Roust Trading.

CEDC said on Friday that its restructuring will not affect the company's operations in main markets Poland, Russia, Hungary or Ukraine.

To read CEDC's official statement, click here.

Expert analysis

Spirits in Poland

In line with growing sophistication and diversification of spirits consumption, spirits sales are becoming increasingly heterogeneous. A considerable group of Polish consumers still strongly follows the westernisation trend. These consumers are strongly aspirational and typically enjoy demonstrating their status. The combination of these factors results in the growing popularity of brown spirits. For example, whiskies and cognac strongly benefit from this trend. The predominant vodka category...

Sectors: Mergers & acquisitions, Spirits

Companies: CEDC

There are currently no comments on this article

Be the first to comment on this article

Related articles

just For Subscribers - The week in drinks

Here are the ten most viewed, subscriber-only items on just-drinks this week:

just the Round-Up - The week in drinks

The top ten stories published on just-drinks this week:

Comment - Wehring's Way - Beam Inc, CEDC and Stock Spirits - Reading Between the Lines

The news that Beam Inc has switched distributors in Poland doesn't really sound like one for the conspiracy theorists, does it?

just-drinks tagline

Not a member? Join here

Decrease font sizeDecrease font sizeDecrease font size Increase font sizeIncrease font sizeIncrease font size Comment on this article Email this to a friend Print this page