Diageo's New Russian Operation Open for Business

11/09/06 Diageo’s new Russian operation, Diageo Distribution, is launched and open for business as the exclusive distributor of Diageo’s collection of premium spirits brands and the Smirnov vodka brand in Russia.

The company, formed as a joint venture company with an Alfa Group company, A 1 Group Limited, is now operational, following receipt of clearances from the Russian anti-monopoly authorities and completion of integration processes. 

Owned 75% by Diageo and 25% by A 1 Group, the company is built on a strong sales and marketing team specifically focused on accelerating growth of Diageo’s spirits portfolio in Russia.  The Russian premium spirits sector is one of the fastest growing in the world and Diageo plans to expand its expertise in luxury brands into the Russian market. 

Through the joint venture with A 1 Group, Diageo also acquired a majority interest in the Smirnov brand and business previously owned by the Smirnov Trading House  as part of the Alfa Group. Under the terms of the deal, the Smirnov vodka brand joins Diageo’s existing collection of international brands, including Smirnoff. 

The new business currently employs five times more staff than Diageo’s previous operation in Russia and ultimately is expected to employ 250 people.  This will include both current Diageo employees, and additional employees recruited from the Russian market to draw on local expertise.  Alison Forrestal, General Manager, Diageo Russia, has been appointed General Director of Diageo Distribution.

Andrew Morgan, President Europe, Diageo plc said: “The opening of Diageo Distribution marks the beginning of a new era for Diageo in Russia and is central to our focus on growing our strength in emerging markets.  We believe this increased investment in Russia creates a strong foundation for future growth.”

Alison Forrestal, General Director of Diageo Distribution, said: “This is a very exciting time for Diageo in Russia.  With a new intake of local talent working to distribute our premium spirits across the region, we expect to accelerate our growth in Russia and aim to become the leading spirits company in this market.”

Alexander Savin, Managing Director of A 1 Group, said: “The joint venture combines the potentials of the Alfa Group, the leading Russian investor, and Diageo, the world’s leading premium spirits company. This marks the appearance of a new player with an extremely promising future. Diageo is a very strong partner, with an exemplary business philosophy, and a highly professional team. As for the Smirnov vodka brand and business – it’s a very attractive asset for strategic investment. Building the Smirnov brand will now acquire a new emphasis. This opens new horizons for itsfuture growth.”