Central European Distribution Corp. is to acquire a major stake in Russian wine and spirit importer and distributor The Whitehall Group.

The US-based company, which operates primarily in Eastern Europe, said yesterday (26 February) that it proposes to acquire a 49.9% voting stake and a 75% economic interest in the group, with an option to acquire its remaining interests no earlier than 31 December, 2013. Financial details for the purchase were not disclosed.

The Whitehall Group will continue to be led by its founder and CEO Mark Kaouffman, who will retain voting and management control over the company, said CEDC.

The investment is expected to close within the next 2 to 4 months and will be financed through a combination of cash, debt and equity.

The proposed investment, which is expected to close within the next two to four months, is subject to negotiation and execution of an acquisition deal subject to customary closing conditions, including both anti-trust and CEDC board approval. The deal will be financed through a combination of cash, debt and equity, the company said.

CEDC president and CEO William Carey said: "The premiumisation trend in Russia for purchasing luxury brands continues to develop at a strong pace. The strong market position of Whitehall will allow the company to take advantage of the growing prosperity in Russia. Mark Kaouffman has built an extremely strong business and we look forward to his continued leadership of Whitehall after our investment."

The Whitehall Group, which imports for wine companies including Concha y Toro, Constellation Brands and certain Gruppo Campari brands, has projected distribution volumes for this year in excess of 1.2m 9 litre cases with forecasted net revenues in excess of US$200m.

The group also imports and distributes brands such as Hennessy, Dom Perignon, Moet & Chandon and Veuve Clicquot and has distribution centres in Moscow, Saint Petersburg, Rostov and Siberia.