Rumours that the Bermuda-based spirits group Bacardi is planning an IPO seem to surface whenever there is little else to report on in the drinks industry, and that certainly appears to have been the case last weekend in the UK.
The Independent on Sunday newspaper reported that the rum-maker was talking with investment banks about a possible floatation which would have valued the company at around €7.2 billion, but the company has denied the claims.
Reports of a possible floatation are not mere invention, however. The company, which is the fourth largest spirit player after Diageo, Allied Domecq and Pernod Ricard, has flirted with the stock market before.
In 1999 the management proposed a floatation which was rejected by the majority of the company's shareholders (most of whom are family members), but the newspaper reported that the company was willing to try again.
But the company said that it was "100 per cent untrue" that it had been in talks with banks, adding that the shareholder vote planned for 6 May (which the paper said could be seen as a precursor to taking the group public) concerned simply an increase in share capital.
While the question of raising capital for expansion is clearly paramount for Bacardi executives, the company seems to believe it can achieve this with the changes to its capital structure and without necessarily resorting to an IPO.
The Independent cited the company's chief executive, Ruben Rodriguez, as saying that the company wanted to be flexible enough to compete with the larger groups. "It would be a shame if we lost a major acquisition because we didn't have the money or didn't want to borrow a sum of money that would put our debt-to-capital ratio in an uncomfortable situation," the report said.
Bacardi, which as well as the eponymous rum brands has several other well-known products such as Bombay Sapphire gin, Dewar's Scotch whisky and Italian aperitif Martini, has thus far carved a significant niche for itself without recourse to the market, and even if the management were keen to push for an IPO, shareholder opposition is still likely to be strong. We are likely, it seems, to hear many more rumours of a floatation before we actually see one.