Allied gains US rights for Stolichnaya

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Allied Domecq today announced it has won the exclusive US distribution rights for Stolichnaya vodka, the country's second-largest imported premium vodka. The rights were formerly held by United Distillers & Vintners parent company Diageo, whose support for its own Smirnoff vodka is thought to have prompted Stolichnaya brand owner Soyuzplodimport to seek a change of distributor.

Allied's 10-year contract to distribute Stolichnaya in the US begins on January 1 2001. The company will be responsible for brand marketing and development and will have first refusal over renewal of the contract, in addition to first refusal over distribution rights in other regions once they become available.

The news adds an intriguing dimension to the auction of Seagram's liquor brands, in which Allied was fighting to gain the distribution rights for Absolut vodka-the number one premium imported vodka in the US. Some analysts believe that Allied has given up on its chances of securing the Absolut rights, hence its eagerness to gain another global vodka brand. Industry sources claim that Absolut brand owner Vin & Sprit are to trust joint Seagram bidders Bacardi-Martini and Brown-Forman with the Absolut rights, leaving Allied and rival bidder Diageo/Pernod Ricard to contest the rest of the Seagram portfolio.
Commenting on the Stolichnaya deal, Allied chief executive Philip Bowman said: "While the Stolichnaya contract enables Allied Domecq to meet its objective of securing a major vodka brand, we remain determined to secure the maximum advantage for our shareholders from the auction of the Seagram wines and spirits business."

Over 1m nine-litre cases of Stolichnaya were sold in the US last year. In duty-free, it is the fifth biggest vodka by volume, with sales of 85,000 nine-litre cases in 1999 according to Global Drinks Record.