UFCW Canada

UFCW Canada

January 25, 2007 06:14 ET

Reminder: Crisis brewing at Crown Royal as strike deadline looms at distillery

WORK STOPPAGE AT DIAGEO PLC CROWN JEWEL DISTILLING ASSET COULD DRY UP SUPPLY OF WORLD FAMOUS CANADIAN WHISKY

Attention: Assignment Editor, Business/Financial Editor, Food/Beverage Editor, News Editor, Government/Political Affairs Editor GIMLI, MANITOBA --(CCNMatthews - Jan. 25, 2007) -
Production of Crown Royal, Canada's world famous whisky, could dry up next week after workers at its Canadian distillery voted overwhelmingly on Tuesday to take strike action if necessary at the Crown Royal whisky facility in Gimli, Manitoba to back up their contract demands.

The Gimli distillery, about 100 kilometers north of Winnipeg is the sole production source of Crown Royal, an iconic Canadian brand once owned by the Bronfman family through its Seagram company and now owned by the foreign multi-national beer and liquor conglomerate DIAGEO.

Crown Royal is the crown jewel of the DIAGEO PLC empire which also includes the Smirnoff, Johnnie Walker, J&B, Gordon's, Malibu, Baileys, Tanqueray and Guinness brands. DIAGEO is listed on both the New York Stock Exchange (DEO) and the London Stock Exchange (DGE).

Crown Royal contributes about $500 million U.S. in annual sales to the DIAGEO's bottom line but next week that tap could be shut after 98% of workers at the plant voted to go on strike February 1st if the company doesn't improve the terms of its last offer.

According to Calvin Firman, President of UFCW Canada Local 200D which represents workers at the plant, "Our membership has lost complete trust in this company. Our members are ready and prepared to strike and make sure not a drop leaves this plant for as long as it takes, whether that be days, weeks or months."

Even a short strike could impact DIAGEO's cash flow and share price which is currently trading near its 52-week high. Because the plant barely keeps up with world demand for the best selling liquor, shortages in the Crown Royal supply chain could appear within days of a strike commencing, choking back a major part of DIAGEO's revenue stream.

According to Firman, revenue from DIAGEO's other brands could also be affected because "we're asking our fellow Canadians to tell this foreign company you can't stick it to Canadian workers just because your head office is in another country. If we go on strike we'll be asking the public to not just boycott Crown Royal, but Smirnoff and Baileys and Guinness beer and all the other brands DIAGEO makes."

Talks to avert a strike are scheduled to resume next Monday.

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Contact:
Calvin Firman, President
UFCW Canada Local 200D
(204) 641-0153

/For further information: Additional contact:
Michael Forman, UFCW Canada Communications
416-675-1104 x 249 office
416-579-8330 cell
mforman@ufcw.ca/ IN: ECONOMY, FOOD, LABOUR, RETAIL, TRADE

Contact Information

  • Calvin Firman, President, UFCW CANADA Local 200D
    Primary Phone: 204-641-0153