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Fortune Brands CEO Holds Meetings on Absolute
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| 4. Fortune Brands CEO Holds Meetings on Absolute
Sven Nordenstam Reuters September 12, 2007 Top executives of Fortune Brands (FO.N: Quote, Profile, Research) visited Stockholm this week to talk to a "broad constituency" of interested parties as Sweden drew closer to a planned sale of state-owned Absolut vodka maker Vin & Sprit. At a news conference on Wednesday where he extolled the virtues of a merger, Fortune Brands Chief Executive Norman Wesley declined to say if executives had met officials handling the V&S sale, which analysts say could fetch about $6 billion. "It's owned by the state and parliament controls the process and we have not come here to try to influence them to do anything but to try to anticipate what might happen," Wesley told reporters. V&S is the crown jewel in Sweden's largest-ever push to privatise state assets -- a process Financial Markets Minister Mats Odell said on Monday was entering a "transaction phase". However, the government has not yet detailed how or when it will sell the spirits maker or the other assets on the block -- two other state-held companies and stakes in three public ones. The list of potential V&S buyers includes French player Pernod Ricard (PERP.PA: Quote, Profile, Research), UK-based Diageo (DGE.L: Quote, Profile, Research) and privately held Bacardi, but Fortune Brands is the only one that does not already have a big vodka brand in its portfolio. Wesley said this could mean fewer antitrust hurdles for a union between the Swedish spirits maker and Fortune Brands. "We're the only one that is not listed as a competitor in the annual report," he said. "Others have conflicts. Diageo has Smirnoff, Pernod has Stoli (Stolichnaya) and Bacardi has Grey Goose. The antitrust authorities will decide how big those issues are." Wesley said a Fortune Brands-V&S (VSG.UL: Quote, Profile, Research) merger would be a "natural extension" of their current relationship, which includes distribution deals for Absolut. These agreements, which carry hefty fees for premature termination, could serve as an effective poison pill by deterring other suitors, industry analysts have said. Earlier this year, French wine and spirits group Remy Cointreau (RCOP.PA: Quote, Profile, Research) took a 241 million-euro provision to quit Maxxium, the distribution pact between it, Fortune Brands, V&S and Scotland's Edrington Group. Fortune Brands and V&S are also intertwined through Future Brands, which distributes Absolut in the United States. Wesley declined to comment on the scale of the fees V&S would have to pay if it left Maxxium and Future Brands, saying the contract arrangements are confidential. He said another buyer would probably opt out of the deals. "My assumption is that they would want to remove it (Absolut) from our distribution arrangements," he said. Wesley said he was confident Fortune Brands would be able to fund a purchase of V&S, despite current credit market turmoil, and pledged to keep vodka production in Sweden. http://today.reuters.com/news/articleinvesting.aspx?type=comktNews&rpc=33&storyid=2007-09-12T180020Z_01_L12925899_RTRIDST_0_FORTUNE-ABSOLUT.XML Directory: 5400 5400 -> - 5400 -> The “Quiet Revolution”: Quebec in the 1960s General Info 5400 -> National news Download 275.06 Kb. Share with your friends:
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