Constellation CEO sees '09 holiday so-so

By Martinne Geller

NEW YORK (Reuters) - U.S. wine and spirits maker Constellation Brands Inc (STZ.N) does not think drinkers will be bellying up to the bar in full force this holiday season, despite some signs of economic recovery.

"I would not be over-optimistic about the consumer this holiday season," said Rob Sands, chief executive of the maker of Robert Mondavi wine, Svedka vodka and Black Velvet Canadian Whisky.

"I don't think it's going to be awful, awful, awful -- but I don't think it will be great," Sands said in an interview ahead of the company's investor meeting on Wednesday.

Sands said Constellation, which also has a joint venture with Mexico's Grupo Modelo (GMODELOC.MX) to import beers like Corona, will likely not see sales at bars, restaurants and convenience stores turn around until employment improves.

"When we've seen unemployment peak and start turning around, you'll start seeing the on-premise and convenience sector start coming back," Sands said, noting that people often buy beer at gas stations after work. By contrast, the grocery store business has been less hurt by the economy, he said.

NO UPDATE ON MERGER

Constellation, the world's biggest maker of branded wine, said earlier this month it was in talks to sell or merge part of its Australian and U.K. wine operations.

At the time, the company said the talks included a potential combination of part of the Australian and British wine operations with Australian Vintage Ltd (AVG.AX).