Swedish Food Workers on Alert as EQT Eyes Government Spirit Company
The Swedish Food Workers' Union (livs) is preparing to meet the challenge of a potential private equity purchase of the government-owned Vin & Spirit AB (V&S), makers of famous Absolut Vodka.
V&S is one of 6 state companies which the Conservative government has scheduled for privatization in its term of office. V&S, which is still the largest producer, importer and wholesaler of alcoholic drinks in Sweden following the end of the government liquor monopoly in 1995, consists of two divisions, wines and spirits, with spirits accounting for the larger part of sales. The spirits division is composed of the Absolut Company, responsible for Absolut vodka (the fourth largest global brand), and Reimersholms, producing largely for the home market. Absolut is the crown jewel for a potential buyer. The selloff, which has had to be postponed due to a series of scandals involving links between government officials and D. Carnegie & Co. AB , the investment bank assisting the government in the selloffs, has attracted interested from major corporate players including Pernod Ricard, Bacardi International Ltd and Fortune Brands Inc.
Enter EQT, the largest Nordic buyout fund (and the firm which ripped apart Findus), which has now confirmed its interest in V&S, and in Absolut in particular. "It's obvious that the different parts can be developed best as separate entities," an EQT spokesperson recently told the financial press. Former V&S Chairman Claes Dahlbaeck sits on EQT's advisory committee
With one of the two V&S production plants already scheduled for closure, Livs is fighting to maintain employment and the future integrity of the company. The union has warned of the dangers of a selloff aimed at generating a one-off cash gain, insisting in the press that the government select a buyer committed to the long term interests of the company, its employees, and the country as a whole. The union also wants production to be continued at both sites.