SWEDEN: V&S denies Allied is favoured Seagram winner

By Elliot Lane | 21 August 2000

Sweden's Vin & Sprit (V&S) has denied claims it would prefer Allied Domecq over Diageo/Pernod Ricard to win the prospective bidding war for Seagram's Spirits and Wine division.According to the UK newspaper Sunday Business, V&S, which owns Absolut vodka but has granted distribution rights to Seagram outside Scandinavia worth £2.2 billion, would favour Allied because it fears Diageo's ownership of the Smirnoff vodka brand could mean a "drawn-out investigation by regulators". A spokeswoman for V&S told just-drinks.com: "This is purely speculation on behalf of the press. We would not like to comment."Sweden's financial daily newspaper, Dagens Industri, however, quoted V&S finance director Rolf Cassergren as saying: "We are a piece on the board since we have a large involvement with Seagram. But there are lots of factors in who eventually wins the business."Absolut accounts for 10% of the $665.5m profit generated by Seagram's drinks business, according to the paper.Sources close to Allied Domecq said the company was "pleased with the positive publicity" but had no knowledge of any preferential treatment from V&S. "The auction has not even started and as yet we don't even know what is for sale and what is not," the source said.Allied's CEO Philip Bowman said in an internal memo to the company's staff on Friday that the Diageo/Pernod Ricard bid was "no surprise" because "Diageo has previously made clear its interest in certain brands within the Seagram portfolio." He doubts its success, however, because Diageo "would encounter major anti-trust problems in bidding for the whole business."He reiterated Allied's previous commitment to participate in industry consolidation but said he would not be "drawn into overpaying and thereby destroying shareholder value."

just-drinks articles are only available to registered users and members.

Join now for increased access

There are various access options to choose from. All provide instant access to the latest news, insight and expert analysis.

If you’re already a member, login here.

Sweden's Vin & Sprit (V&S) has denied claims it would prefer Allied Domecq over Diageo/Pernod Ricard to win the prospective bidding war for Seagram's Spirits and Wine division.According to the UK newspaper Sunday Business, V&S, which owns Absolut vodka but has granted distribution rights to Seagram outside Scandinavia worth £2.2 billion, would favour Allied because it fears Diageo's ownership of the Smirnoff vodka brand could mean a "drawn-out investigation by regulators". A spokeswoman for V&S told just-drinks.com: "This is purely speculation on behalf of the press. We would not like to comment."Sweden's financial daily newspaper, Dagens Industri, however, quoted V&S finance director Rolf Cassergren as saying: "We are a piece on the board since we have a large involvement with Seagram. But there are lots of factors in who eventually wins the business."Absolut accounts for 10% of the $665.5m profit generated by Seagram's drinks business, according to the paper.Sources close to Allied Domecq said the company was "pleased with the positive publicity" but had no knowledge of any preferential treatment from V&S. "The auction has not even started and as yet we don't even know what is for sale and what is not," the source said.Allied's CEO Philip Bowman said in an internal memo to the company's staff on Friday that the Diageo/Pernod Ricard bid was "no surprise" because "Diageo has previously made clear its interest in certain brands within the Seagram portfolio." He doubts its success, however, because Diageo "would encounter major anti-trust problems in bidding for the whole business."He reiterated Allied's previous commitment to participate in industry consolidation but said he would not be "drawn into overpaying and thereby destroying shareholder value."

  • Unlimited access to all the latest global beverage news and insight
  • Expert analysis that puts the news into context
  • Exclusive interviews with leading industry figures
  • Monthly management briefings with detailed analysis on hot topics
  • Personalised RSS feeds and email newsletters
  • 10-year archive of news, insight and intelligence
  • Discounts on just-drinks market research
  • Plus much more

If you’re already a member, login here

Not what you were looking for?

Search just-drinks:

More articles related to this one

COLOMBIA: Diageo launches new look for flagship
Diageo is looking to change the image of one of its flagship brands in Colombia.

US: Fortune confirms Allied bid talks
The US consumer goods group Fortune Brands has confirmed it is in talks about launching a joint bid with Pernod Ricard for Allied Domecq.

UK: Diageo launches global ads for Smirnoff Ice
Diageo is to launch a new global advertising campaign for Smirnoff Ice. The first ad in the global campaign, 'Garden', launches in Great Britain on April 11th on terrestrial and satellite TV.

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