Blavod talks fall through

Published: 23 July, 2008

The takeover talks between Blavod Extreme Spirits, the producer of flavoured vodkas, and an unidentified American company have fallen through.

Blavod said it had terminated discussions due to the bidders inability to provide due diligence comfort to the Blavod board regarding specific offer or company information'.

The all-shares approach would have valued Blavod at no less than 12.8 million and came from an unidentified company listed on America's Nasdaq exchange. This generated speculation that the suitor might have been 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, the suitor is more likely to have been interested in acquiring the fast-growing range of Players Extreme spirits and the tequila joint venture with Suntory of Japan.

Blavod was floated in London in early 2001 at 35p per share and then merged with Extreme Spirits in 2003. Investors have faced a roller-coaster ride, with the shares peaking at 53p in the summer of 2001 but plunging to below 15p just before the bid approach was received. They sank below 9p when the takeover talks failed.

Commentators have suggested 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 3.9m to 2.9m. It had total assets of 7.81m on its balance sheet as of 31 March 2006.

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