Stoli vodka files for bankruptcy in the United States
By Jordan Valinsky, CNN
New York (CNN) — Stoli Group USA, the owner of the namesake vodka, has filed for bankruptcy as it struggled to contend with slowing demand for spirits, a major cyberattack that has snarled its operations and several years of fighting Russia in court.
The company in its bankruptcy filing said it is “experiencing financial difficulties” and lists between $50 million and $100 million in liabilities. Stoli vodka and Kentucky Owl bourbon will continue to be available on store shelves while the company navigates the Chapter 11 process, which only pertains to its US business.
Until 2022, Stoli was sold as Stolichnaya in the US, which loosely translates to “capital city” in Russian. The company shortened its title following Russia’s invasion of Ukraine and boycotts against Russian-branded vodkas. Stoli Group’s founder, Russian-born billionaire Yuri Shefler, was exiled from that nation in 2000 because of his opposition to President Vladimir Putin.
The liquor has long been marketed as a Russian vodka, but its production facilities have been in Latvia for several decades. Stoli Group is a unit of Luxembourg-based SPI Group, which owns other spirit and wine brands.
“The Stoli Group has been targeted by the Russian Federation since it was formed nearly 25 years ago,” said Stoli Group CEO Chris Caldwell in a statement. “Earlier this year the company and our owner were both named by the Russian state as ‘extremist groups working against Russia’s interests.’”
Its ongoing legal battle with the Russia government has forced Stoli to “spend dozens of millions of dollars on this long-term court battle across the globe with the Russian authorities,” according to its court filing.
Caldwell also said that Stoli’s global operations has been a “victim of a malicious cyber attack” that has forced the company to operate “entirely manually while the systems are rebuilt.”
A slowdown in demand for alcohol has crushed several company’s bottom lines following the pandemic when people were stuck at home and stocked up. Stoli’s filings said that it has seen a “decline and softening of demand for alcohol and spirits products post-Covid and especially beginning in 2023 and continuing into 2024.”
The-CNN-Wire
™ & © 2024 Cable News Network, Inc., a Warner Bros. Discovery Company. All rights reserved.
