9 Apr 2018 08:25
9 April 2018
Conviviality Plc
("Conviviality" or the "Company")
Proposed Sale of Business
Conviviality Plc (AIM: CVR), announces that the business and assets of the Conviviality Retail businesses have been sold to Bestway Direct Limited, a national retailer and wholesaler of grocery products. This sale secures continued employment for circa. 2,300 employees of the Conviviality Retail business and provides continuity of trade for suppliers and franchisees.
Matthew Callaghan, Ian Green, and David Baxendale of PricewaterhouseCoopers LLP have, late on Friday 6 April, been appointed as joint administrators of each of the Wine Rack Limited and Conviviality Retail Logistics Limited and Matthew Callaghan, Ian Green and Peter Dickens of PricewaterhouseCoopers LLP have, at the same time, been appointed as administrators of Bargain Booze Limited. The administrators have effected a sale of the trade and assets of the Conviviality Retail business undertaken by these companies. 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.
Bestway have paid £7,250,000 for certain of the business and assets of the Conviviality Retail business.
Information on the Conviviality Retail businesses
Conviviality Retail is the UK's largest franchised off-licence and convenience chain with over 350 franchisees and more than 800 retail stores trading primarily under the fascias of Bargain Booze, Select Convenience, Wine Rack and Central Convenience, with a distribution from 2 warehouses in Crewe and Newcastle under Lyme.
In the latest audited accounts for the 52 weeks ended 30 April 2017, the Conviviality Retail businesses had gross revenues of £378 million and adjusted EBITDA of £14.3 million (pre central costs)1. Gross assets of the Retail business (including the Central Convenience business acquired in December 2017) are approximately £173 million, of which approximately £73 million relates to intangible.
Information on Bestway
Bestway Group was founded in 1976 by Sir Anwar Pervez. It is the UK's 8th largest privately-owned company and 5th largest family-owned business. The Bestway Group includes: Bestway Wholesale, the largest independent wholesaler in the UK; Best-one, the franchise operator of over 1,113 convenience stores operating under the Best-one fascia; Bestway Foodservice, offering a nationwide one-stop solution for caterers and the licensed trade, operating under the names Bestway Batleys Foodservice and Drinks Express; Bestway Cement, the largest cement manufacturer in Pakistan; United Bank Limited, the 2nd largest private bank in Pakistan; and, Well Pharmacy, the 3rd largest pharmacy business in the UK.
The Board consider that the offer from Bestway represents the best outcome for franchisees, suppliers, customers and employees of the Conviviality Retail business.
It is with regret that the Board notes that the companies are not expected to have sufficient assets to satisfy all their liabilities. PricewaterhouseCoopers will be in contact with creditors of Wine Rack Limited, Bargain Booze Limited and Conviviality Retail Logistics Limited. The Board also understand that the realisations will be insufficient to provide any return to shareholders.
The Board wish to thank its franchisees, customers, suppliers, employees and banking syndicate for their continued support during this difficult period.
Temporary Suspension of Trading on AIM
The shares of Conviviality Plc remain suspended pending further notice.
1 Conviviality Retail 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:
FTI Consulting Tel: 020 3727 1000Jonathon Brill / Georgina Goodhew / Fiona Walker
PricewaterhouseCoopers LLP Email: conviviality@uk.pwc.com
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.