SPI Group will not be bidding for Central European Distribution Corp

SPI Group has pulled out of the race to buy Central European Distribution Corp (CEDC).

The company, which owns the Stolichnaya vodka brand and held two sets of the notes that had been launched by CEDC, confirmed this afternoon (28 March) that its consortium has “withdrawn its proposal for the restructuring of” CEDC. SPI had been working with the A1 investment division of Alfa Group and Mark Kauffmann, the former owner of the Whitehall Group in Russia, on a takeover bid for the troubled spirits group.

“Today, … A1, together with the other members of the consortium, determined the transaction was no longer sufficiently attractive,” a statement from SPI said.

The statement was released after reports claimed that Kaufmann had withdrawn his support for the bid.

Earlier this month, just-drinks exclusively revealed that SPI, A1 and Kaufmann were set to table a US$275m offer for CEDC. The bid, which was an improvement on an earlier offer by the consortium, was questioned by CEDC late last week. “We are surprised to see that … the consortium has resubmitted an almost identical proposal, with marginally improved economic terms, that fails to address any of the concerns previously raised,” said CEDC last week.

US-based CEDC has been struggling with debt in recent months as it tried to raise the funds to pay off a set of notes that matured earlier this month.

The move leaves the way clear for Roustam Tariko, the owner of the Russian Standard vodka brand, to proceed with his debt-reduction proposal that would see him take an 85% stake in CEDC.