FTC Approves V&S Buyout Under Certain Conditions
The Federal Trade Commission today issued a complaint charging that Pernod Ricard's proposed $9 billion acquisition of Swedish spirits company Vin & Sprit (V&S) would be anticompetitive and in violation of U.S. antitrust laws because it would effectively combine the two most popular brands of "super-premium" vodka sold nationwide, Absolut and Stolichnaya.
To eliminate the anticompetitive effects of the proposed transaction, the FTC will require Pernod to end its distribution agreement with the owners of Stolichnaya, Spirits International BV (SPI), within six months of acquiring V&S and the Absolut brand. This requirement is contained in a consent order agreed to by Pernod. Recall that Pernod had already planned to end it agreement with SPI.
The FTC also showed concern for Pernod having access to "competitively sensitive information" on Beam Global's Cognac, domestic cordials, coffee liqueur, and popular gin once it assume V&S's role in Future Brands (the joint-venture between Beam and V&S).
"Fortune's subsidiary Beam Global Spirits & Wine, Inc. (Beam Global) owns brands that compete with Pernod brands in four markets - Cognac, domestic cordials, coffee liqueur, and popular gin. Pernod's participation in the joint venture would give Pernod access to competitively sensitive information about the competing Beam Global brands. The consent order preserves the competition between Pernod and Beam Global by imposing firewalls to prevent Pernod from acquiring and using competitively sensitive information about the Beam Global brands."
"The proposed acquisition would have...raised concerns about the exchange of information in four other distilled spirits markets," said Jeffrey Schmidt, Director of the FTC's Bureau of Competition. "The consent order announced today effectively addresses those concerns and ensures that the Absolut and Stolichnaya brands, and the Pernod and Beam Global brands, will continue to compete aggressively."
To read the full press release, click here.
Until tomorrow, Megan
"The secret of staying young is to live honestly, eat slowly, and lie about your age."
Lucille Ball
To eliminate the anticompetitive effects of the proposed transaction, the FTC will require Pernod to end its distribution agreement with the owners of Stolichnaya, Spirits International BV (SPI), within six months of acquiring V&S and the Absolut brand. This requirement is contained in a consent order agreed to by Pernod. Recall that Pernod had already planned to end it agreement with SPI.
The FTC also showed concern for Pernod having access to "competitively sensitive information" on Beam Global's Cognac, domestic cordials, coffee liqueur, and popular gin once it assume V&S's role in Future Brands (the joint-venture between Beam and V&S).
"Fortune's subsidiary Beam Global Spirits & Wine, Inc. (Beam Global) owns brands that compete with Pernod brands in four markets - Cognac, domestic cordials, coffee liqueur, and popular gin. Pernod's participation in the joint venture would give Pernod access to competitively sensitive information about the competing Beam Global brands. The consent order preserves the competition between Pernod and Beam Global by imposing firewalls to prevent Pernod from acquiring and using competitively sensitive information about the Beam Global brands."
"The proposed acquisition would have...raised concerns about the exchange of information in four other distilled spirits markets," said Jeffrey Schmidt, Director of the FTC's Bureau of Competition. "The consent order announced today effectively addresses those concerns and ensures that the Absolut and Stolichnaya brands, and the Pernod and Beam Global brands, will continue to compete aggressively."
To read the full press release, click here.
Until tomorrow, Megan
"The secret of staying young is to live honestly, eat slowly, and lie about your age."
Lucille Ball
posted at 7:30 PM
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