By Tom Hals and Nick Brown
WILMINGTON/NEW YORK, May 13 (Reuters) – A bankruptcy court
on Monday approved Central European Distribution Corp’s
bankruptcy exit plan, putting Russian billionaire
Roustam Tariko on the verge of adding one of the world’s largest
vodka producers to his stable of companies.
Under the plan, green lighted in U.S. Bankruptcy Court in
Wilmington, Tariko will receive all of the Polish company’s
newly issued stock in return for $277 million he is providing
for the benefit of its creditors. The deal essentially creates
an alliance between CEDC and Russian Standard Vodka, the rival
vodka maker also owned by Tariko, according to a statement
issued on Monday by CEDC.
The plan is expected to become effective on May 31, the
statement said.
Tariko became chairman of CEDC, which makes Absolwent and
Parliament vodkas, last year after striking a deal aimed at
rescuing the troubled company. CEDC has a leading market share
in Russia, Poland and Hungary, but ran into financial problems
after restating its results.
Despite an investment by Tariko, CEDC continued to be dogged
by a cash crunch. It filed for bankruptcy on April 7 with a plan
to cede ownership to Tariko after he outmaneuvered other
potential investors for control of the company. Its current
stock will be canceled, and it will cease to be publicly traded,
according to the statement.
“The court’s approval of our financial restructuring is a
very positive step forward,” Tariko said in the statement. “The
company’s world-class brands are now able to continue to build
on their success locally and globally.”
Tariko adds CEDC to a group of investments that includes
Russian Standard Corp, maker of the eponymous Russian Standard
brand vodkas. CEDC will emerge from bankruptcy having shed $665
million in debt.
Founded by American William Carey, CEDC started as an
importer of beer into Poland. The company’s operations were
based there, and until this year it also maintained a
headquarters in Mount Laurel, New Jersey, and was listed on the
Nasdaq.
