Pernod Ricard has signed an agreement with Norway-based Arcus-Gruppen to sell its Danish and German brands and focus on priority brands.

Arcus-Gruppen is involved in the production, sale and distribution of wine and spirits in the Nordic region.

The transaction includes sales of Danish aquavit brands Aalborg and Brondums, German brand Malteserkreuz Aquavit and the Danish bitter brand Gammel Dansk, besides the sale of the Aalborg production plant in Denmark.

The acquired brands will help Arcus-Gruppen increase its sales in the spirits segment by 50% and thereby increase its operating profits.

The purchase price of EUR103m will be mostly financed through a loan in Arcus-Gruppen.

Ratos, a Sweden-based private equity conglomerate that holds 83% shares in Arcus-Gruppen, will provide equity in a maximum amount of EUR9m.

Ratos CEO Susanna Campbell said Arcus-Gruppen has achieved strong growth in the wine segment in Sweden and Norway in recent years and emerged as the largest wine supplier in the Nordic region.

"We are now taking the next step and strengthening the portfolio of spirits brands as well," Campbell added.

"This is a strategically significant acquisition which will considerably increase Arcus-Gruppen’s size and market presence within the spirits segment."

Arcus-Gruppen CEO Otto Drakenberg said the company plans to build its strong local Nordic brands and make Nordic aquavit brand attractive in international markets.

"We have a long tradition of doing this successfully in Norway and Sweden," Drakenberg added.

"Therefore, we are delighted to be able to increase our presence in Denmark and Germany by adding strong and renowned brands such as Aalborg and Gammel Dansk to our portfolio."

The transaction is awaiting approval from authorities and is expected to be completed by the third quarter of the financial year 2012/13.