A consortium that was competing with Russian billionaire Roustam Tariko for control of Polish vodka producer Central European Distribution Corp. (CEDC) withdrew its takeover offer today.
Fellow billionaire Mikhail Fridman’s A1, CEDC shareholder and bond investor Mark Kaufman and SPI Group, which sells Stolichnaya vodka, each announced their were withdrawing in separate e-mailed statements today.
Kaufman decided to withdraw after assessing CEDC’s demands for a higher restructuring bid, their recent financial results and the costs of the group’s proposed U.S. bankruptcy filing, Cyril Benoit, a Paris-based banker advising the investor, said by phone today. Benoit said he couldn’t comment on why A1 and SPI walked away.
The group’s pre-packaged bankruptcy proposal competed with a restructuring takeover offer from Tariko’s Roust Trading, which CEDC has backed. The Warsaw-based company, whose shares sank 50 percent in New York last year amid management changes and faltering sales, was unable to repay $258 million of notes due March 15. CEDC earned two-thirds of 2012 sales in Russia, where it produces Zelyonaya Marka, Parliament and Zhuravli vodka. Tariko owns the Russian Standard vodka company.
The A1 consortium is affiliated with Russia’s OAO Alfa Bank. CEDC acquired Kaufman’s Russian liquor importer Whitehall Group in stages between May 2008 and February 2011. Whitehall imports drinks including the Hennessy, Dom Perignon, Moet & Chandon and Veuve Clicquot brands.
Tariko Plan
As a bondholder, Kaufman won’t vote in favor of Tariko’s plan, said Benoit, his adviser. Kaufman objects to Tariko’s proposals including the idea that some junior creditors would be paid when all senior holdings haven’t been repaid, Benoit said. Creditors are voting on whether to accept Tariko’s plan.
The counteroffer group withdrew their bid one day after their lawyers and bankers held separate calls with bondholders and media to discuss the merits of their plan.
CEDC rose 2.8 percent to 31 cents by 2:55 p.m. in New York. The stock is down 86 percent this year.
To contact the reporter on this story: Beth Jinks in New York at
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To contact the editor responsible for this story: Jeffrey McCracken at
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