(Photo: svklimkin/Pexels)
Stoli Group USA, owner of Stoli Vodka and its subsidiary Kentucky Owl American whiskey, filed for Chapter 11 bankruptcy on Thursday. The move comes on the heels of a years-long legal dispute with Russian regulators and a "malicious cyber-attack" that crippled Stoli's virtual infrastructure.
Bankruptcy filings show that the company, owned by Russian-born billionaire Yuri Shefler, lists between $100 to $500 million in assets and between $50 to $100 million in liabilities.
In addition to its namesake vodka, Stoli Group USA owns a varied agave spirits portfolio including Cenote, Nick Jonas' Villa One Tequila and Se Busca Mezcal. All brands under the Stoli umbrella will continue to operate normally as the company reorganizes its debts and pauses payments to creditors.
Stoli Vodka has been at the center of a tug-of-war between Shefler and Russian authorities since 1997. Under the current arrangement, Shefler sells Stoli-branded products in international territories while Russia produces its own "Stolichnaya" vodka for domestic consumers. A string of lawsuits has drawn a sharp distinction between the brands. In 2018, Stoli was ordered to pay nearly two decades of profits generated in Belgium, the Netherlands and Luxembourg to the Russian government.
The dispute took a contentious turn following the invasion of Ukraine. In 2023, Stoli penned an official denouncement of the Russian war effort in which it called out the "Putin regime" by name. The statement was accompanied by a limited-edition Ukraine Vodka decorated in shades of yellow and blue, proceeds for which raised funds for Chef Jose Andrés’ World Central Kitchen. Within a year, the Russian government announced plans to seize Shefler's assets.
Shefler fled Russia in 2002 and currently resides in Switzerland. His vodka brand, historically marketed as a Russian product, has been produced in Latvia since he was effectively exiled from his home country.
“The Stoli Group has been targeted by the Russian Federation since it was formed nearly 25 years ago,” Stoli Group CEO Chris Caldwell in a statement obtained by CNN. "Earlier this year, the company and our owner were both named by the Russian state as ‘extremist groups working against Russia’s interests’."
Caldwell also claims that Stoli Group USA was targeted by hackers in October. The attack allegedly downed its operating systems, forcing the company to carry out business manually in the months leading up to its bankruptcy filing.
“Two months ago, the company was the victim of a malicious cyber-attack which knocked out its ERP (enterprise resource planning) platform and operational systems, since when it has been operating its global business entirely manually while the systems are rebuilt," Caldwell added.
The bankruptcy process is slated to begin on Dec. 2 and finish sometime in the first half of 2025.
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