Pernod Ricard to consolidate in France and sell wine brand, make 280 redundancies

Drinks giant Pernod Ricard will merge its two French businesses, Ricard and Pernod, next year, which would lead to 280 jobs being open to voluntary redundancy.

The group’s French business is based on two companies and two separate distribution networks, Pernod and Ricard, which it said is “overly complex” and “lacks agility,” in an emailed statement.

It said that group sales in France have fallen by €60 million (US$65 million) in the past two years. Pernod Ricard said this is the result of “deflationary pressures”, the impact of the Egalim Law – which has seen enhanced food and drink regulation in France – as well as an emerging group of consumers who are “reinventing the meaning of convivialité”.

The group plans to unite the two businesses under the name Pernod Ricard France by July 2020, echoing similar restructures that have taken place in the US and China.

It is part of a strategy Pernod Ricard is implementing to keep its market share in France, in a project it has called ‘Reconquer’.

The company said the merger would lead to “approximately 280 roles being open to voluntary redundancy”, with mostly the sales and marketing departments affected by the new business combination.

It said the merger would also create around 90 new roles to “support this new strategy”.

Philippe Coutin, chairman of both Ricard and Pernod, told a gathering of all employees of both companies this week that the group is “entering into a phase of collaboration with management and unions”.

“We hope this phase will be as responsible and interactive as possible.”

He added that, throughout the company’s history, “Ricard and Pernod have managed to evolve and reinvent themselves to continue the entrepreneurial adventure embarked upon by our founders.

“We have always succeeded together, and together we will rise to this challenge.”

The company also announced it intends to sell its sparkling wine brand Café de Paris and the Cubzac production site to Invivo Wine, the wine division of the French agricultural cooperative. This, it said, would be completed with a “guarantee to safeguard the jobs of the site’s 29 employees”.

Pernod Ricard and Invivo are in talks to establish a sub-contracting agreement for the brands that will not be sold to Invivo.