Future in China's taste for cognac

The company has put Piper-Heidsieck and Charles Heidsieck on the market as the wine and spirits producer seeks to focus on the more profitable cognac market.

Pernod Ricard is among the potential bidders for the champagnes, which are on the market for an estimated €320 million ($441m), according to analysts.

Piper-Heidsieck and Charles Heidsieck may be among the most illustrious names in sparkling wine, but Remy Cointreau's champagne division makes less money than competitors such as Pernod Ricard, LVMH, Laurent Perrier and Vranken-Pommery.

Remy Cointreau's champagne unit reported a loss of €4m on sales of €96.6m last year. The company announced a restructuring with 45 job losses in February, prompting staff to walk out in a rare instance of industrial action in the Gallic luxury goods industry

Although Remy Cointreau said that sales of its champagnes had increased by 15.7 per cent in the first half of this year compared with last - largely through a rise in exports to Britain - the group wants to focus on selling cognac to the Chinese.

Demand for the tipple in China was partly responsible for an 18.3 per cent increase in Remy Cointreau's overall first-half sales to €482.2m.

Christine Ropert, a Gilbert Dupont analyst, said that Piper-Heidsieck and Charles Heidsieck stood out for their poor performances in an otherwise profitable champagne sector.

"They are recognised brands with international positions, but Remy Cointreau has never been able to do anything with them," she said.

The sale was logical, she said, but the timing was surprising in the middle of a restructuring that had yet to bear fruit.

Remy Cointreau said that it had asked Credit Agricole-CIB to look for bidders for Piper-Heidsieck and Charles Heidsieck.