Stoli Group Moves Its Two U.S. Entities Into Chapter 7 As Geopolitical and Market Shocks Converge

Stoli Group announces that its two U.S. entities, Stoli Group USA, LLC and Kentucky Owl LLC, filed a motion to convert Chapter 11 into to Chapter 7. Control of these U.S. entities will be transferred to a court-appointed trustee, who will oversee the liquidation process.

This development affects only Stoli Group USA, LLC and Kentucky Owl LLC that filed for Chapter 11 protection in November 2024. All other U.S. and non-U.S. operations, including Louisiana Spirits, SPI Spirits (Cyprus) and global production facilities, are completely unaffected and continue normal operations.

A Quarter-Century of Unprecedented External Pressures

For more than 25 years, Stoli Group has been engaged in protracted legal disputes with the Russian state over brand ownership and control. Those pressures intensified sharply in recent years. After the company publicly condemned the invasion of Ukraine and voiced its support for peace, the Russian government designated Stoli an "extremist organization" in Russia.

This was swiftly followed by the confiscation and nationalization of Stoli's state-of-the-art distillery, an asset integral to the company's global production footprint. Soon afterward, Stoli was hit by a large-scale, sophisticated cyberattack that targeted its international operations and impaired systems vital to global distribution. Remediation efforts continue to this day.

The Chapter 11 Process

These geopolitical shocks, combined with a slowdown in the U.S. spirits market and a lack of support and flexibility from the Group's finance partners, led Stoli Group to file for Chapter 11 protection in November 2024. Over the past thirteen months, the Group worked to construct a viable reorganization plan aimed at preserving jobs, stabilizing operations, and protecting long-standing commercial partnerships.

Despite those efforts and extensive negotiations, the Group was unable to reach an agreement with its senior lender on terms that would allow these two U.S. entities to emerge from Chapter 11 as a going concern.

Consumer Availability

We believe there is sufficient inventory of Stoli brands in the U.S. market to ensure consumers will be able to continue purchasing these products for the foreseeable future.

The global Stoli Group business continues to operate normally inside and outside the United States, with production facilities and distribution networks unaffected by this development.