Conviviality Fails To Raise GBP125 Million Needed To Recapitalise

LONDON (Alliance News) - Troubled alcoholic drinks wholesaler Conviviality PLC said on Wednesday it has failed to raised the full GBP125.0 million needed to "adequately recapitalise the business".

"Despite a significant number of meetings with potential investors resulting in good levels of demand, and constructive discussions with a number of key customers and suppliers regarding the provision of support, there was ultimately insufficient demand to raise the full GBP125.0 million," Conviviality said in a statement.

The company said it is in discussions with its lending banks and advisors regarding other possible options, and is in receipt of "a number of inbound enquiries" regarding a potential sale of all or parts the business. A further update will be made as appropriate.

Conviviality added that it believes shareholders in the company will receive "little-to-nil" value. Shares in Conviviality remain suspended.

Wednesday's announcement comes after the company last week said it continues to have constructive discussions with lenders and with HM Revenues and Customs regarding a GBP30.0 million tax bill due at the end of the month.

The GBP125.0 million placing proceeds were expected to be used to resolve overdue payments with its creditors, settle the GBP30 million tax bill, repay a GBP30.0 million loan facility and for working capital purposes.