RUSSIA/US: CEDC CEO steps down, Russian Standard founder becomes chairman
CEDC has said farewell to its CEO, Bill Carey, with Russian Standard's founder, Roustam Tariko, becoming chairman
The CEO of Central European Distribution Corporation (CEDC) has stepped down from the role, as the spirits company has confirmed its tie-up with Russian Standard.
The US-based firm, which operates predominantly in Central and Eastern Europe, confirmed today (9 July) that, as a result of its agreement with Russian Standard, Bill Carey has resigned as chairman, president, CEO and member of CEDC's board. Russian Standard, which agreed to spend US$100m on upping its stake in CEDC in April, also reaffirmed today that it will spend up to a further $210m on newly-issued, unsecured CEDC senior notes, due at the end of July, 2016.
The extra funds from Russian Standard will allow CEDC to repay or repurchase all of its outstanding 3% Senior Convertible Notes due in 2013.
At the same time, Russian Standard has been granted authorisation by CEDC to buy its stock on the open market that, when added to its current holding, would not exceed a 33% stake in CEDC. That threshold will be raised to 42.9%, however, “upon receipt of certain Polish regulatory waivers”, CEDC said.
While Carey will stay on with CEDC in a consultative capacity on an interim basis, David Bailey, the current lead director of CEDC, will become interim CEO.
Roustam Tariko, the founder and chairman of Russian Standard, is set to become non-executive chairman of CEDC. Russian Standard will also be allowed to appoint four members to CEDC's board should it reach 40% ownership.
“With the investment by Russian Standard having secured our ability to retire our 2013 convertible notes, we can now focus all of our energies on growing and improving our business - both through internal efforts and through our new strategic alliance with Russian Standard,” said Bailey.
“This combination has multiple benefits for all involved and we are very excited about the opportunities it provides."
“I would like to thank Bill Carey for his dedication to CEDC and to wish him all the best in his future endeavours. Thanks to Bill's leadership as CEO from the company's founding, we will be building on a base as one of the world's largest vodka producers.”
The search for a permanent CEO will start immediately, CEDC added.
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