Sweden's message in a bottle: Absolut is for sale

updated 7:17 p.m. ET March 5, 2007

STOCKHOLM, Sweden - Thanks in part to its renowned advertising campaign, a vodka distilled in the southern Swedish town of Ahus has become the world's No. 3 premium spirit and one of the country's most recognizable brands.

So would the owner — the Swedish government — consider selling the crown jewel of Scandinavian liquor to a foreign buyer?

Absolutely.

After 90 years in state hands, Absolut vodka is about to be offered up for sale with its parent company V&S Vin & Sprit AB, along with five other companies in which the state holds significant stakes. The government is to seek parliamentary approval for the V&S sale on Friday.

With an estimated price tag of $5.7 billion, potential buyers include market leader Diageo PLC, Pernod Ricard SA and Fortune Brands, which already has a distribution deal with V&S.

"It's the best price that counts," Swedish Financial Markets Minister Mats Odell told The Associated Press.

The state sellout of banking group Nordea AB, telecom TeliaSonera AB, Nordic bourse operator OMX AB, real estate company Vasakronan AB and mortgage lender SBAB to help pay off the country's debt represents the biggest ideological shift since the center-right coalition government ousted the long-ruling Social Democrats in October.

The sale of V&S is especially sensitive, since the company founded in 1917 has been closely linked with the state's efforts to control alcohol consumption in Sweden. The government has held a monopoly on retail sales of alcohol since the 1850s and Sweden was able to preserve that even after joining the European Union, citing reasons of public health.

"We don't think that the state should run businesses on a competitive market," Odell said. "The state shouldn't make, sell or distribute vodka."

Critics say rushing to find buyers for V&S could leave the liquor maker in the hands of a profit-hungry company with no sense of social responsibility.

"Odell must show that another owner would be more restrictive, but I think it will be the opposite where a new owner will be more aggressive," said Thomas Ostros, industry minister in the previous Social Democratic government. "The state, as an owner, has developed one of the most successful brands that Sweden has. That's nothing to be ashamed about."

MORE FROM FOOD INC.

Food Inc. Section Front

Tough times seem to benefit General Mills Early ‘Boston Market’ restaurateur dead at 52 Domino’s changing pizza recipe McDonald's to lift fee for Internet access Campbell Soup to change SpaghettiOs recipe McDonald's serving up breakfast dollar menu Costco will resume carrying Coke products General Mills cutting sugar in kids' cereal McDonald’s: U.S. same-store sales dip Transgender teen: McDonald’s discriminates Food Inc. Section Front   Add Food Inc. headlines to your news reader: