Pernod Ricard says tops ultra-premium spirits market

SHANGHAI, May 26 (Reuters) Pernod Ricard SA, the world's second-largest wines and spirits group, said it has become the top maker of ultra-premium spirits, as it increased its presence in China and India.

With strong sales of Chivas Regal whisky in China, where a campaign to mix it with green tea has boosted the popularity of the brand, the French firm is strengthening its position in the global spirits market, said managing director Pierre Pringuet in remarks embargoed until Saturday.

''For these ultra-premium products, we're indeed in first place,'' Pringuet said at a company briefing in Shanghai, citing industry data for 2005, the latest available to the company.

He said Pernod Ricard had a 51 percent share of the market for ultra-premium Scotch whisky, where its Chivas Regal brand competes with Johnnie Walker, owned by industry leader Diageo.

It also had a 32 percent share of the cognac market, where Pringuet said it slightly lagged Moet Hennessy, majority-owned by France's LVMH.

In India, where the alcoholic drinks market is dominated by whisky, Pernod Ricard sales are growing at double the market pace of 12 percent a year, boosted by local brands such as Royal Stag, said Param Uberoi, who heads the company's Indian business.

International spirits and wines today command less than 1 percent of the total market in India due to high import duties, but Uberoi said these could be cut gradually to as low as 50 percent, boosting sales of international whisky brands.

''If the base customs duty comes down, of course these segments will explode,'' Uberoi told the briefing.

Speaking of acquisition plans, Pringuet said the company was ''very pragmatic'' and would not exclude takeover deals, and that financing of at least one major deal was ''not an issue'', thanks to strong cash flow.

Pernod Ricard has expressed an interest in acquiring Swedish state-owned AB Vin&Sprit, owner of Absolut vodka, and is negotiating to buy the rights to the Stolichnaya vodka brand.

''It's pretty clear that one of the vodkas would be the priority today,'' Pringuet told Reuters on the sidelines of the briefing.

''We must be cautious in the sense that, yes, we can finance acquisitions with debt, but of course we're not going to come with a pile of debt. We must remain reasonable.'' Reuters DKS GC0427