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Takeover rumours surround Blavod

Published:  23 July, 2008

Blavod Extreme Spirits, the producer of flavoured vodkas, is discussing being taken over by an unidentified American company. If an offer is made, it will value Blavod at no less than 12.8 million.

Blavod said that the all-shares approach had come from a company listed on America's Nasdaq exchange. This generated speculation that the suitor could be Drinks American, which specialises in personality' brands such as Donald Trump's Super Premium Vodka and Willie Nelson's Old Whiskey River Bourbon.

While Blavod is best known for its eponymous black vodka brand, the unnamed suitor is more likely to be keen on acquiring the fast-growing range of Players Extreme spirits and the tequila joint venture with Suntory of Japan.

The company was floated in London in early 2001 at 35p per share and then merged with Extreme Spirits in 2003. Investors have faced a rollercoaster ride with the shares peaking at 53p in the summer of 2001, but plunging to below 15p just before the bid approach was received.

Commentators suggest that while Blavod's sales have been very buoyant, especially in the US, it is still in a development stage. In the year to 31 March, 2006, it narrowed its pre-tax losses from 3.9 millon to 2.9 million. They also speculated that any suitor would have to pay more than the mooted 12.8 million to win Blavod, which had total assets of 7.81 million on its balance sheet on 31 March.