Magners cider offers lifeline to Conviviality

Bankruptcy Blog Insolvency

Dublin-based C&C Group, owners of Magners cider along with other popular alcohol brands, is set to purchase Mathew Clark and Bibendum, the wholesale arms of Conviviality.

C&C Group’s move is set to secure more than 1,800 jobs.

The move comes in the wake of Conviviality’s drift into insolvency, having been refused a request for £125 million from investors. The injection of cash would have kept the threat of bankruptcy at the door, which came in the wake of a series of unexpected profit warnings.

The profit warnings led to trading in shares being suspended on the junior AIM stock market back in March, with shareholders likely to be left empty handed.

Conviviality, which also owns the chain of Bargain Booze off licences, admitted that the first warning came as a result of not budgeting for a £30 million tax bill, a mistake which led to the resignation of its chief executive. It has since been looking for buyers, undertaking discussions with a number of interested parties.

The news that C&C Group is set to buy the wholesale operation will come as a welcome relief to those employees affected. The group’s chief executive said: “We know the Matthew Clark and Bibendum businesses very well. They are great businesses with unparalleled on-trade market access, a wide range of supplier relationships and supported by a knowledgeable and loyal employee base.

“The last few weeks have been challenging for employees, customers and suppliers alike. We hope today’s announcement can put an end to this period of disruption and uncertainty. We look forward to working with our new colleagues and other stakeholders to bring stability and restore the group’s position as one of the leading and most respected drinks suppliers to the UK hospitality sector.”

If your company is facing financial difficulties and threatened with insolvency, get professional advice from the experts. Contact Gibson Hewitt today.