PERNOD Ricard refused to rule out selling non-core Scotch whisky assets yesterday as part of a 1 billion (£788 million) disposal programme to cut its near-12bn debt mountain.
Pernod, which through its Chivas Brothers subsidiary is Scotland's second-biggest whisky company, behind Diageo, has seen debt jump after completing the 5.69bn takeover of Swedish drinks group Vin & Sprit. The latter's best-known product is Absolut,
the world's best-selling premium vodka.
Pierre Pringuet, Pernod's managing director, said none of the French drinks giant's 15 key strategic brands were up for sale. These include Ballantine's, Chivas Regal, Jameson and The Glenlivet whiskies.
Chivas Bros has about 1,100 employees in Scotland and has a 21 per cent share of the Scotch whisky market.
Other major spirits brands not up for sale include Martell cognac, Beefeater gin and Havana club rum.
Pringuet, also posting a 2.2 per cent rise in full-year group sales to 6.59bn, said the company had received expressions of interest from both trade and private-equity buyers.
Pringuet said: "There are no strategic brands on the list. They are profitable but secondary brands (up for sale]. We already have a lot of interest, but I won't elaborate on this."
Asked if the asset sale might include "second-tier" Scotch whisky assets, Pringuet declined to comment.
Separately from this sale programme, Chivas Bros had already created some controversy by saying it was considering the sale of the smaller brand Glendronach. Pringuet confirmed that was still the case.
Among profitable though non-stragetic whiskies Pernod owns are the blends Hundred Pipers, Clan Campbell and Something Special, and malts Scapa and Tormore.
Pernod is the world's second-biggest spirits and wine company, with products ranging from vodka and gin to cognac and tequila.
Pernod said it was confident in achieving the top end of its estimated cost savings from the Vin & Sprit acquisition of between 125m and 150m.
The savings, coupled with the asset disposals over the next 12 to 18 months, should allow it to reduce its debt quickly, it said.
Fourth-quarter revenues were down 3 per cent at 1.49bn, which Pernod said was partly a result of the earthquake in Sichuan in China. Pringuet said Chinese people stopped going out drinking in bars as a show of "solidarity" with those who lost friends and relatives in the quake.
During the year to end-June, overall Jameson sales rose 21 per cent, while The Glenlivet was up 14 per cent. Sales at Chivas 18 and 25-year-old rose 42 per cent against 9 per cent for Chivas 12-year-old.
Q4 in the UK was tougher, however, hit by the Budget increase in excise duty, with growth of Pernod's spirit sales down to 2 per cent.
The full article contains 474 words and appears in The Scotsman newspaper.
