Blavod Black stirs market

A spirits company is on its way to the stock market.

Its identity has yet to be revealed but if all goes according to plan it will be the subject of a reverse take over by Blavod Black, the ambitious company which is making more than the odd ripple with its distinctive black vodka.

In just two days last week the possibility of a deal being clinched increased dramatically.

First, Blavod Black said it was in "very preliminary" talks to take over a spirits business that would mean the recruitment of a significant new shareholder ­ an indication that any acquisition will be largely financed by issuing shares.

Then, 48 hours later, it disclosed the talks had progressed and its shares would be suspended.

There is, of course, a whole range of possible candidates for the black vodka bandwagon.

A reverse take over usually means the bidder is smaller than the target.

With Blavod Black, at its 57.5p suspension price, valued at £8.2m, a deal up to £20m, even more, is a possibility.

My own guess ­ and it is no more than that ­ is that it is hoping to venture into the Scotch whisky industry where some distinguished unquoted companies, such as William Grant & Sons, exist.

Already Blavod Black has whisky links.

Its chairman is Allan Shiach, head of the Macallan-Glenlivet malt whisky group before it was unceremoniously taken over, and recent boardroom recruit William Phillips has spent a lifetime in the spirits business.

His record embraces Macallan-Glenlivet and, intriguingly, Janneau, the Armagnac brandy firm.

Chief executive Richard Ambler is ex-Diageo.

Other possibilities abound.

Unquoted English distilleries could be in its sights.

Perhaps De Vere, the hotel chain, is at last unloading its G&J Greenall gin distillery?

There is also a chance that spirits play only a part in the target's operations and Blavod Black is aiming for a ready-to-drink producer.

It could be some time before we know.

Take over deals often take months to put to bed.

Remember last year's protracted negotiations over the Burn Stewart whisky group?

I drew attention to Blavod Black and its progress earlier this year.

It continues to make headway with its up-market vodka.

In the year to March sales rose from £1.1m to £1.5m with the pre-tax loss narrowing from £1.2m to £581,000.

Share tipster Tom Winnifrith, on City website www.t1ps.com, is a keen follower of the shares ­ he tipped them at 37.5p ­ and expects the company to break even this year.

The group is clearly keen to utilise its share quote; so the latest expansionist move should come as no surprise.