FRANCE: Remy Cointreau says Champagne sale process ongoing

Remy Cointreau has said that it has received interest in its Champagne business, but the group declined to put a deadline on a sale.

Remy Cointreau appointed Credit Agricole bank to organise an auction for its Champagne business, including the Piper-Heidsieck and Charles Heidsieck brands, in November last year.

A spokesperson for Remy told just-drinks today (17 January) that the sale process is ongoing. "There is no timeline on it," she said. She added that the group has received interest, but declined to comment further. Remy's director-general, Jean-Marie Laborde, said at the end of November that he expected preliminary offers for the Champagne arm by the end of the year.

Analysts think that the business could fetch around EUR300m (US$399m), but several big industry players are not expected to show interest. Diageo has its eyes on other assets, plus it already operates in Champagne with Moet Hennessy, while Pernod Ricard has ruled itself out of acquisitions until it obtains investment grade credit rating.

Private equity is considered one likely destination for the business. One analyst told just-drinks today that the deal is largely "a question of price". Remy's attempt to sell the same division in 2004 collapsed after it failed to find a buyer that would meet its valuation.

This time, given the company's focus on Remy Martin Cognac in China, the group may be more willing to "bundle out" the Champagne arm at a lower price tag, the analyst said.

Remy has said that the business is "not profitable enough". Its Champagne arm reported losses of EUR2.8m for the six months to the end of September 2010, versus losses of EUR3.5m a year earlier, despite recovering some of the sales lost in 2009.