Finish Saimaa to invest 217 mln euros in its Russian subsidiary by 2013

Finish beverage producer Saimaa Beverages Oy Ltd said on Wednesday it plans to invest 217 million euros in the development of its Russian subsidiary Organic Vodka Group by the end of 2013.

“Organic Vodka Group plans to reach a 3.5 percent share on the Russian vodka market by the end of 2013 and a 20 percent share in the premium segment,” Saimaa said in a statement. “Saimaa Beverages will invest 217 million euros in the project during this time frame.”

OVG plans to release the low-premium vodka trading mark Drova and the Finnish premium-class vodka Suomi onto the Russian market in 2011. The Drova brand will be outsourced to Russian facilities, while the Suomi vodka will be produced at the Saimaa Beverages production base in the Finnish city of Lappeenranta. The company is currently choosing a partner for the project.

The overall output of the Suomi vodka will be 50,000 deciliters per month at the launch stage, while the expected output of the Drova vodka has not yet been specified.

“The company’s business in Russia is managed by a professional team, which has successful experience of start-ups on the alcohol market,” Saimaa said. “The last project, managed by the Russian top-managers, was Mosoblalkogol, a company established during the global financial crisis, which finally demonstrated a rapid growth.”

OVG is already tied up in contracts with 142 Russian alcohol distribution companies.

“We need to close 200 contracts before the active sales season starts this year in order to hit the planned sales volume, which will let us reach the announced goals,” Organic Vodka Group Sales Manager Dmitry Bogatov said. He added that the planned regional sales structure covered 80 percent of the Russian regions and up to 50 percent of points of sale in each region.

Leave a comment