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Nemiroff's sale is put off
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1 March 2011
Moscow – There is no point in selling the Nemiroff Company, as the company is able to develop independently, President of Nemiroff Managing Company Oleksandr Hlus has told Interfax.
However, he said that there is no official policy not to sell the company.
The first reports of the possible sale of Nemiroff appeared in early 2010. Poland's CEDC, Britain's Stock Spirits and Russian Standard Holding showed interest in the Ukrainian company. However, the talks on a sale were not fruitful.
On February 23, the holders of a 75 percent stake in Nemiroff Holding, one of the largest vodka producers in the CIS, Yakiv Hrybov and Anatoliy Kipish said that they had withdrawn from talks on the company's sale.
Hrybov said that a strategic development plan for five years would be adopted soon.
"Oleksandr Hlus wanted to keep his share in the company, and the buyers who held talks on the company's sale did not object this," he said.
"Before the decision on the sale, my position was that there is no point in selling the company in the present conditions. I opposed the decision [to sell the company]," Hlus said.
He said that at that moment an efficient platform for further business development and a transparent financial model had been created.
"The development strategy required certain investments from shareholders, but even with the insufficient level of investment in the company's development, the results of 2010 proved my case. The Nemiroff brand's positions grew on foreign and domestic markets," he said.
Vodka sales in the CIS grew by 29 percent and in Europe, Asia and the United States they soared by 49 percent. The company also became the market leader in monetary terms in Ukraine for the first time in its history.
Hlus said that the Nemiroff brand has a great deal of potential, which should be strengthened thanks to sound expansion to the most promising markets, which include Poland, the United States and China.
"Of course, the company is always interested in the Russian market, but this is possible only if shareholders are ready to invest in development. The company's ways to develop are obvious for me, and I'm ready to work fruitfully in the future," he said.
Hlus added that a decision to withdraw from the talks on the company's sale has not been made, as currently there is no document confirming this.
"No one has set a date for a meeting of the shareholders' board to discuss the issue," he said.
Commenting on the proposal of key shareholders to change the structure of the company's management and transfer it to hired managers, Hlus said that before the decision to sell Nemiroff was made, a corporate management system in line with the international practice was created and it was divided into strategic and operational management.
"However, after the decision to sell was made, it became impossible to search for independent managers, as the key element of the value of the company in the process of the sale is a team of top managers that have achieved good results. Of course, if needs be, the management system should be changed very carefully so as not to do harm to the positions of the company, which is successfully developing," Hlus said.
Some media reports say that the board of directors of Nemiroff Vodka decided to appoint Hlybov instead of Hlus. Hlus said that the board chairman is a formal post that does not give any advantages over other board members, and he is the moderator of meetings, announcing the agenda.
He added that the decision was not stipulated in the minutes that are to be signed by board members, so it is not valid.
"In other words, there are no decisions [on the new appointment] today," he said.
The Owners of Nemiroff Holding are Hrybov (40 percent), Kipish (35 percent) and the Hlus family (25 percent). In 2010 the holding boosted sales by 13.6 percent compared to 2009, to $473.6 million.
Source: Interfax-Ukraine, KyivPost
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