LONDON (Brand Republic) – Drinks giant Allied Domecq’s contract to distribute Russian brand Stolichnaya vodka could come under threat as the Russian government threatens to bring the brand back under state control.
The Russian government is claiming that when the brand’s owner Soyuzpludimport was privatised during the collapse of the Soviet Union, the price paid for the company was too low.
Allied’s agreement covers the distribution of the product in the US, as well as a first right of refusal for other parts of the world as and when the contracts become available.
The drinks company dismissed the speculation about the future of its contract, saying that even if the brand was nationalised the government would still need someone to distribute the brand outside Russia.
If the brand is nationalised, ownership would be transferred to a state holding company called Rosspirtprom, as would Soyuzpludimport’s other vodka brand Mokovskaya. The state holding company was set up in May to house all the state-owned vodka distilleries.
The move comes on the back of recently published government figures suggesting that Russians drink about 140m litres of eau de toilette and perfume products a year.