US spirit major Fortune may acquire Absolut

09 February 2008

Mumbai: US-based Fortune, maker of Jim Beam bourbon, now leads the $6 billion-plus race to acquire Sweden's Absolut vodka, following the exit of Diageo, as the world's biggest alcoholic drinks group.

Diageo's pull-out of the race for Absolut was also due to Fortune's distribution deal for Absolut. Diageo, which pulled out of the process on Wednesday, said it saw little chance of success with Fortune and Absolut so closely linked.

Top spirit makers, including France's Pernod Ricard, privately-owned Bacardi and Fortune, were all interested in Absolut.

Diageo, which opted out, instead bought a stake in a Dutch vodka firm.

"The Absolut process has become tortuous and the belief is that the Swedes favuor the incumbent distributor, which is Fortune," said one source close to the talks.

Fortune may be the smallest of the big four spirits groups but its 10-year distribution deal in the key US vodka market for Absolut, which runs to 2012, has put it in the driving seat and make bids from its rivals more difficult.