12.07.10 Synergy Group and Veda Group have signed mutual exclusive long term agreement for distribution and production of Veda vodka, one of the leading premium vodka brands in Russia
Moscow, 12 July 2010 – Synergy Group and Veda Group announce that they have signed exclusive long term agreement for distribution and production of Veda vodka, one of the leading premium vodka brands in Russia.
According to the agreement, Synergy will produce Veda vodka at Mariinsky factory, the designated premium quality spirits production plant located in Siberia. The brand will be distributed through Synergy’s federal distribution network, one of the largest distribution systems in Russia that will enable Veda brand a wide geographical footprint.
Since introduction of Veda vodka on the Russian spirits market in 2004 the brand gained a unique market position as a premium vodka brand that embodies both the traditions and modernity of today’s Russia. Veda vodka is produced in two versions: Ice Filtered and Black Ice, both firmly priced in the premium price category. Veda vodka brand is well recognized on the distilled spirits market through strong presence in big federal retail chains and wide on- and off- trade activities in Russia and the CIS.
The addition of Veda brand into Synergy’s federal distribution portfolio provides Synergy with accretive exposure to premium price segment with one of the most recognizable brands on the premium market which is in line with the Synergy’s premiumization strategy.
Alexander Mechetin, the Chairman of the Management Board of Synergy, commented as follows on the agreement: “We are delighted to expand and strengthen our federal brand portfolio with a strong premium brand that gained wide recognition on the market. We believe that with the addition of Veda brand to our federal brand portfolio we will be able to benefit from the premiumization trend and Veda vodka is uniquely placed to secure future growth for the brand through our strong distribution platform. At the initial stage of the agreement we will benefit from additional production and distribution margins of the brand and as long as the future brand performance successfully fits our strategic expectations, we may consider to enhance our participation in the brand‘s development.”
Currently Anastasia Ragozina, the President of Veda Group remains the beneficial owner of Veda brand and will continue to actively contribute to the brand development and brand management.
On the announcement of the agreement Anastasia Ragozina noted: “With this new cooperation, Veda brand found one of the strongest partners on distilled spirits market in Russia and the CIS. The brand will get access to industry-leading infrastructure and dedicated sales capabilities, which will accelerate its development. Both partners share the benefits from Veda brand expansion and believe in the success of future cooperation.”
Renaissance Capital acted as financial advisor on the cooperation agreement.
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About Synergy Group
Synergy is one of the leading and fastest-growing producers of distilled spirits in Russia, focusing primary on vodka production. As of the end 2009, the Company had a 9% share of the Russian legal market and sold 10,131 million decaliters, according to Rosstat Agency.
Synergy has a diversified portfolio of national vodka brands addressing market demand across the full spectrum of price points from the low-middle price segment to the super-premium price segments. The Company's national vodka brands include Beluga, Myagkov, Belenkaya, Russky Lyod, Beloe Ozero and Gosudarev Zakaz. Those brands are producing on seven own distilleries strategically dispersed across Russia.
To perform the widest sales penetration the company created and operates it’s own strong distributional system which include regional and local sales teams. The system covers the whole country’s territory and provide a stable supplies for all regions.
Availability of strong brand portfolio, production base and sales machine provides Synergy with competitive advantages and allow the Company to increase organic growth from year to year.
In November 2007, the Company made the first successful IPO in the Russian distilled spirits sector. The IPO proceeds amounted to US$190.4 mln. Also in October 2009, Synergy did the SPO which comprises 4,000,000 Shares, representing approximately 27.93% of the issued and outstanding Shares at the time of the Offering, and a total offer size of approximately US$80 million before fees and expenses and the free float increased to 34%.
Synergy also owns and operates an additional business divided into two main lines: agriculture and food processing. The Company’s facilities include eight plants located in the Saratov, Khabarovsky and Primorsky regions.
For more information about Synergy please visit Company’s web site http://www.sygroup.ru/
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