Dec 28 (Reuters) - Top shareholder Roustam Tariko will get operational control of Polish vodka maker Central European Distribution Corp in exchange for up to $65 million in funding, CEDC said on Friday.
Directors nominated by Tariko’s Russian Standard will take responsibility for CEDC’s operations through a newly-formed committee.
The panel, led by Tariko himself, will oversee all day-to-day business and operations and the company’s management will report directly to it.
CEDC -- the maker of Absolwent and Parliament vodka -- also named Grant Winterton, currently the general manager of one of its units, as its chief executive.
Russian billionaire Tariko acquired about 28 percent of CEDC earlier this year through his companies Russian Standard and Roust Trading in a deal that was expected to help the Polish company retire looming debts.
However, Tariko in a Nov. 13 letter, said Roust Trading is no longer obligated to complete the pending deal as recent restatements by CEDC had led to a breach of the agreement.
CEDC earlier this month rejected a proposal that would have thrown it a lifeline in exchange for several conditions, including handing over operational and financial oversight to directors designated by Roust Trading.
Under the new deal, a special committee led by CEDC directors unaffiliated with Russian Standard will retain control of any restructuring of CEDC’s capital structure.
CEDC also agreed to call an annual shareholders’ meeting to elect new directors, another of Tariko’s long standing demands.
In return, Tariko has released contractual restrictions on $50 million in cash previously invested in CEDC, and committed to make available a $15 million revolving credit facility.
The agreement follows a flurry of letters from Tariko and CEDC’s second largest shareholder Mark Kaufman, expressing disappointment with the way the company was operating and calling for a shake-up of the board.
CEDC shares were down 9 percent at $2.00 on Friday on the Nasdaq. They have lost half of their value so far this year after falling 80 percent in 2011.