4 Apr 2018 17:14
4 April 2018
Conviviality Plc
("Conviviality" or the "Company")
Proposed Sale of Business
Conviviality Plc (AIM: CVR), announces that it has sold its Conviviality Direct businesses1 to C&C Holdings NI Limited, a wholly owned subsidiary of C&C Group Plc ("C&C"), which ensures this business continues to trade as a going concern and ensures that:
· all trade creditors of the Conviviality Direct business will be paid in full;
· continuity of supply is assured for suppliers and customers of Conviviality Direct; and
· continuity of employment for the c. 1,900 Conviviality Direct employees.
The Company's subsidiary, Conviviality Brands Limited appointed administrators earlier today and the administrators have affected the sale of the entire share capital of Matthew Clark (Holdings) Limited and Bibendum PLB (Topco) Limited (parent companies of all of the Conviviality Direct trading companies1). The sale has been agreed further to receipt of many expressions of interest in connection with an accelerated sale process co-ordinated by PricewaterhouseCoopers LLP.
Information on the Conviviality Direct businesses
Matthew Clark is the largest independent distributor to the UK on-trade drinks sector. It offers a range of over 4,000 products, including beers, wines, spirits, cider and soft drinks, sourced from in excess of 300 suppliers. Matthew Clark has a nationwide distribution network of 15 depots and sales team of over 250 serving the independent free trade and national accounts as well as a state-of-the-art on-line ordering system.
Bibendum is one of the largest wine, spirits and craft beer distributors and wholesalers to the UK on-trade and off-trade, with a particular focus on wine. It offers a range of over 4,000 wines, spirits and craft beers sourced from over 400 suppliers from over 20 different countries.
The sale includes the disposal of Catalyst, the Company's brand representation business, and Peppermint the Company's outdoor events business.
As released by C&C in its announcement this morning, in the latest audited accounts for the 52 weeks ended 30 April 2017, the Conviviality Direct businesses had gross revenues of £1,219 million and adjusted EBITDA of £51.3 million (pre central costs)2. Gross assets are approximately £230 million.
Information on C&C
C&C is listed on the Irish and London Stock Exchanges and is a leading manufacturer, marketer and distributor of branded cider, beer, wine and soft drinks. C&C brands include: Bulmers the leading Irish cider brand; Tennent's, the leading Scottish beer brand; Magners the premium international cider brand; Tipperary Water; Finches soft drinks, as well as a range of niche, premium and craft ciders and beers. C&C is also a leading drinks wholesaler in Scotland and Ireland, where it operates under the Tennent's and C&C Gleeson brands respectively.
The Board consider that the offer from C&C represents the best outcome for creditors, suppliers, customers and employees of the Conviviality Direct business. C&C have undertaken to provide substantial funding to the Conviviality Direct business to ensure creditors are paid and to address the cash flow constraints that have been encountered. C&C have paid a nominal sum for the shares acquired and have agreed to pay, in aggregate, £102 million to Conviviality's secured lenders over the next 12 months to repay the debt of the Conviviality Direct business to such banks.
Conviviality Retail
The Company continues to pursue opportunities in respect of the Conviviality Retail business and will provide an update in due course.
No other companies in the Group have had administrators appointed and such other companies continue to trade.
The Board wish to thank its customers, suppliers, employees and banking syndicate for their continued support during this difficult period for the Company.
Temporary Suspension of Trading on AIM
The shares of Conviviality Plc remain suspended pending further notice.
1 Conviviality Direct includes the Conviviality Trading Division, which was consolidated into Conviviality Direct following the organisational change announced in January 2018. Trading companies to be acquired by C&C include Conviviality Group Limited (trading as Matthew Clark, Bibendum, Catalyst PLB and CDC), Walker & Wodehouse Wines Limited, PLB Group Limited, Elastic Productions Limited, Peppermint Events Limited and The Wondering Wine Company Limited.
2 As per PWC IM - (March 2018) financials for Conviviality Direct as extracted from the audited financial statements of Conviviality Plc for the 12 months ended 30 April 2017, adjusted EBITDA is prior to allocation of group and central overheads, interest, depreciation, amortisation and exceptionals.
Enquiries:
Investec (Nominated Adviser and Broker) Tel: 020 7597 5970Garry Levin / David Flin / Daniel Adams
FTI Consulting Tel: 020 3727 1000Jonathon Brill / Georgina Goodhew / Fiona Walker
The information contained within this announcement is deemed by the Company to constitute inside information stipulated under the Market Abuse Regulation (EU) No. 596/2014. Upon the publication of this announcement via the Regulatory Information Service, this inside information is now considered to be in the public domain. The person responsible for arranging release of this information on behalf of the Company is Ciaran Stone, Group Head of Legal & Company Secretary.