Lion Capital – a UK private equity firm – has purchased Green Mark, Russia’s top-selling vodka brand for $600m (£300m) The deal to buy Russian Alcohol – Green Mark's makers – is the latest in a string of western private equity investments in Russia. Russia has the highest per capita consumption of vodka in the world, ahead of Ukraine, and 90% of the spirits drunk in the country are vodka. It is the world’s second-biggest market in terms of retail sales after the US, with $15bn of sales in 2006, according to Renaissance Capital, the Russian investment bank. Lion Capital, the European offshoot of what was once Hicks, Muse, Tate & Furst, is leading the acquiring consortium that includes Central European Distribution Company, one of Poland’s biggest vodka companies, and Goldman Sachs, which is advising on the deal. The consortium has agreed with three Russian banks to roll over the company’s existing debt. Russian Alcohol is forecast to achieve net sales of $500m in its current financial year. It is being sold by Industrial Investors, the holding company of Sergei Generalov, the former Russian minister of fuel and energy. With a stable of brands that includes Zhuravli, an upmarket vodka, Russian Alcohol is the world’s third-largest vodka producer behind Smirnoff and Absolut, which was sold last month by the Swedish government to France’s Pernod Ricard. Faced with a credit crisis and slowing economies in the US and Europe, top private equity groups are venturing into markets such as Russia, where political risks and the dominance of oligarchs have previously dissuaded them from investing. Although Renaissance expects sales volumes of Russian vodka to slow over the next few years, it expects vodka sales revenues to rise as higher incomes allow people to buy more expensive kinds of vodka. Most of the vodka sold in Russia costs $3 a bottle, compared with average prices of $49 in Norway and $14 in the US. Russian Alcohol – the country’s biggest producer – controls 5% of the market.