'Little Red Riding Hood' Sparkling Wine Flying High

Wilhelm II., Germany's last emperor, praised its lightness, and East German leader Erich Honecker used it for toasts to Cuba's Fidel Castro and other visiting heads of state. After the Wall fell, West Germans ridiculed Rotkäppchen as "Ossibrause," or Easterner's fizzy drink.

But such jokes died down by 2001 at the latest, when the eastern German sparkling wine maker stunned Westerners by doing what few others had managed: It took over western German competitor Mumm, followed by yet another East-West acquisition of Geldermann sparkling wines in 2003.

It's been pretty much a fairy tale ever since for Rotkäppchen, the German word for "Little Red Riding Hood," even though the champagne gets his name from the red cap on its bottles.

"We're modern, self-confident and successful," Rotkäppchen CEO Gunter Heise said. He added that the company, which employs 383 at its headquarters in Freyburg in Saxony-Anhalt and three west German locations, didn't see itself as an "East German" business any more.

In 2003, Rotkäppchen sold 103.1 million bottles for the first time, making it the leading German champagne maker with a market share of 31.2 percent and revenues of €340.5 million ($405 million).

Acquisition of the western German brands has also helped the company to promote its Rotkäppchen brand nationwide as company officials were able use already existing distribution channels.

Company executives, who took over in a management-buyout in 1993, said they were confident they would increase sales yet again this year. "We want to keep growing and are aiming for a sales increase of 2 percent this year," Heise said.

While other champagne makers are eyeing markets in Eastern European countries and beyond for expansion, Rotkäppchen seems content to keep growing at home, according to Frankfurter Allgemeine Zeitung.