LUXEMBOURG: SPI Group "considering" bid for CEDC
SPI Group has already held talks about Central European Distribution Corp
The owner of the Stolichnaya vodka brand, SPI Group, has confirmed that it is considering make a move for embattled spirits producer Central European Distribution Corporation.
The Luxembourg-based, Russia-originated company, which owns two sets of notes that were launched by CEDC, said earlier today (5 March) that it has held talks with”a few strong financial players” in Russia over a move for the US-based company. Last week, CEDC offered stock to some of its note-holders, as the company is not in a position to cover its debt.
"We are carefully observing the situation around CEDC,” said SPI CEO Val Mendeleev. “We have already begun preliminary discussions with a few strong financial players in Russia who could be interested in considering the CEDC business together with us.
“While our evaluation is ongoing, we are confident in our ability to pursue potential alternatives with respect to CEDC, if we decide to do so."
SPI Group would not comment further on today's statement.
In launching the stock offering last week, CEDC warned that it would table a bankruptcy filing in the US if the move was not accepted by note-holders. The filing would "effectuate the restructuring through a fall-back, pre-packaged Plan of Reorganisation", the firm said.
CEDC, which operates primarily in Central and Eastern Europe, 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.
As SPI Group looks to weather a boycott of Stolichnaya in the US, Chris Mercer considers what steps a drinks company should take if - or when - a crisis hits....
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