Mixing their drinks

In an effort to combat financial problems faced by several Polmos distilleries, the Treasury Ministry plans to create a Polish Spirits Group (PGS). The group will consist of vodka producers in Szczecin, Bielsko-Biała, Toruń, Konin, Józefów and Warsaw.

The distilleries will be restructured and some workers will be laid off. Alcohol production is to be concentrated in two distilleries, in Józefów and Bielsko-Biała. PGS will also acquire the best assets of the remaining entities, such as a laboratory in Konin and the chain of outlets in Warsaw belonging to Koneser. The Ministry is also considering adding two other distilleries - Sieradz and Łódź - to the group.

The Ministry wants to see the consolidation completed by the end of this year. Then there are plans to privatize the group. "I'm inclined towards selling PGS' shares on the WSE, but the state will maintain a majority in the group," said Deputy Treasury Minister Paweł Piotrowski told Parkiet. However, the debut on the bourse is unlikely to take place before next year. Piotrowski says that PGS should have around 15 percent of the vodka market.

The idea has met with some opposition. "This won't bring anything good," says the financial director of Polmos Białystok, Bogusław Wojtach. He points out that while Polmos Józefów and Polmos Bielsko-Biała are doing fine, the other producers "are not making it ... The ones that are doing well might be weakened rather than strengthened."

Wojtach claims that creating a group is just avoiding making a decision about the future of the weaker companies. "A manly decision must be made, but I doubt anyone in this government will make such an unpopular decision," Wojtach concludes.