Patrick Ricard to step down next year

Patrick Ricard, the chairman and chief executive of Pernod Ricard, the world’s second largest premium drinks company, has confirmed that he will step down from all executive roles within the company next autumn. Mr Ricard told the company’s annual meeting in Paris today that at the 2008 annual meeting that his roles would be split; he would become non-executive chairman and Pierre Pringuet, the present managing director, would become chief executive.

At the meeting M Ricard forecast that Pernod Ricard would achieve profits growth of about 10% in the financial year to July 2008. He also reported that the company’s gearing (ratio of debt to shareholders funds) had fallen “below one”. “This gives us financial leeway”, he said. Significantly, shareholders subsequently approved a resolution that allows the company to issue an extra 20% of shares to help part fund any takeover it may consider within the next couple of years.

Asked whether he was considering further takeovers, M Ricard said that the company was “working on two projects”.  The first is full ownership of Stolichnaya. “We have been trying to unify the brand for some time”, he said, but the Russsian business belongs to the Russian state. If we had been in the driving seat, the deal would have been done, but I hope we can close the deal.”

The second potential takeover was of Absolut vodka. “We have had no details about the process the Swedish government is going to adopt,” M Ricard said. “It has been delayed more than once, but we have a team working on it.” However, he was at pains to tell shareholders: “We could not afford to do both deals”, prompting speculation that the group’s interest in Absolut was a Plan B should it fail to gain full control of Stolichnaya.

Mr Ricard also told the meeting that “wine is on the back burner for acquisitions.”

© db Ron Emler 7 November 2007