Bargain Booze owner Conviviality plans to appoint administrators within the next 10 days “unless circumstances change”, putting 2,600 jobs at risk.

Bargain Booze owner Conviviality plans to appoint administrators within the next 10 days “unless circumstances change”, putting 2,600 jobs at risk.

The company said on Thursday that it will continue trading over that period in the hope of preserving “as much value as possible” for its stakeholders.

It will keep working alongside advisers and said it is exploring “a number of inbound inquiries regarding a potential sale of all or parts of the business”. The company is understood to be lining up PwC to lead the process.

The move puts thousands of jobs at risk, as Conviviality employs over 2,639 people and has more than 700 retail stores trading primarily as Bargain Booze, Select Convenience and Wine Rack. “Following discussions with its lending banks, the board has resolved to file notice of intention to appoint administrators to the company,” Conviviality said in a market announcement.

Toys R Us have filed for administration in a nightmare quarter for the retail sector (Yui Mok/PA) “Unless circumstances change, and in accordance with statutory requirements, the board intend to appoint administrators within 10 business days.” Shares have been suspended since Conviviality disclosed the discovery of its tax bill, which created what it called a “short-term funding requirement”.

It follows a torrid month for the firm, which saw its chief executive Dianna Hunter step down after issuing a string of profit warnings and revealing a £30 million tax bill. Conviviality was forced to go cap-in-hand to investors to raise £125 million as a result, but has been unable to convince them of its long-term future.

Ms Hunter, a former Waitrose director who had been chief executive since 2013, led the group through its stock market flotation in the same year, and oversaw a number of acquisitions, including Wine Rack, Matthew Clark and Bibendum.

“As we found with Palmer & Harvey’s rapid demise in late 2017, a default of this nature can have considerable short-term implications for supply chains, both those set not to be paid or those that seek to fill the void by the disruption to supplies that the current kerfuffle causes,” Shore Capital analysts Phil Carroll and Clive Black said.

Private equity firms could be ready to snap up the entire business with an eye on a few “selective disposals,” although the big four supermarkets and companies like CostCutter and Spar may also emerge as suitors, Mr Caroll and Mr Black explained. Its Matthew Clarke and Bibendum assets are positioned to attract big brewers, they added. The company’s collapse would cap a nightmare quarter for the retail sector.

Since January, Toys R Us and Maplin have filed for administration, while fashion retailers such as New Look and Select have embarked on radical store closure programmes. Piling on the misery has been the under-pressure casual dining sector, with Prezzo, Byron and Jamie’s Italian all shutting restaurants and culling hundreds of jobs. </s> Conviviality, the company behind the off-licence chains Bargain Booze and Wine Rack, is to appoint administrators within a fortnight, putting 2,600 jobs at risk.



The impending administration has prompted warnings that pubs could run dry. More than 20,000 of Britain’s pubs are supplied by the company’s Matthew Clark division. The trade body, the British Beer & Pub Association, said many could now face “short-term supply issues”.

Conviviality said following discussions with its banks, the board had decided to to appoint administrators within 10 business days, unless circumstances change. The secured creditors can also appoint administrators without filing notice.

The news came a day after the company said investors had refused its request for a fresh cash injection of £125m, needed to stave off bankruptcy after a string of profit warnings. The first profit warning was related to Conviviality’s failure to budget for a £30m tax bill. Its chief executive, Diana Hunter, has stepped down.

Directors are still looking for a buyer for all or part of the business, and it will continue to trade.

The firm said in a stock market statement on Thursday: “The directors intend to allow the business to continue to trade and the company continues to work alongside advisers in order to preserve as much value as possible for all stakeholders as it explores a number of inbound enquiries regarding a potential sale of all or parts of the business.”

Conviviality supplies more than 700 off-licences and more than 23,000 pubs and restaurants including the JD Wetherspoon chain.

The firm’s shares remain suspended from the junior Aim market. Investors are likely to receive “little to nil” value for their shares, the company said.



Accountancy firm PricewaterhouseCoopers is expected to manage the administration. </s> Bargain Booze owner Conviviality has said it intends to appoint administrators within the next 10 business days "unless circumstances change", putting 2,500 jobs at risk.

The company's collapse would cap a nightmare quarter for the retail sector.

Since January, Toys R Us and Maplin have filed for administration, while fashion retailers such as New Look and Select have embarked on radical store closure programmes.

Piling on the misery has been the under-pressure casual dining sector, with Prezzo, Byron and Jamie's Italian all shutting restaurants and culling hundreds of jobs.

Conviviality said it plans to continue trading and will work alongside advisers as it explores a "number of inbound enquiries" over a possible sale of all or parts of the business.

The company said it will continue trading over that period in the hope of preserving "as much value as possible" for its stakeholders.

It will keep working alongside advisers and said it is exploring "a number of inbound enquiries regarding a potential sale of all or parts of the business".

"Following discussions with its lending banks, the board has resolved to file notice of intention to appoint administrators to the company," Conviviality said in a market announcement.

"Unless circumstances change, and in accordance with statutory requirements, the board intend to appoint administrators within 10 business days."

The chain first started in 1981 before growing to have more than 610 shops across the UK.

Over the past few weeks, the firm has seen its chief executive Dianna Hunter step down after issuing a string of profit warnings and revealing a £30 million tax bill.

Conviviality was forced to go cap in hand to investors to raise £125 million as a result, but it has been unable to convince them of its long-term future.

Ms Hunter, a former Waitrose director, had been chief executive since 2013 and led the group through its stock market flotation in the same year.

She also oversaw a number of acquisitions, including Wine Rack, Matthew Clark and Bibendum.

Non-executive chairman David Adams has taken her place until further notice. </s> More than 2,600 jobs are in jeopardy as Bargain Booze owner Conviviality prepares to call in administrators.

The group, which runs more than 700 retail stores trading as Bargain Booze, Select Convenience and Wine Rack, said that “unless circumstances change” it plans to appoint administrators within the next 10 business days.

It will continue trading over that period in the hope of preserving as much value as possible for its stakeholders and is also working alongside advisers as it explores “a number of inbound enquiries regarding a potential sale of all or parts of the business”.

Recent weeks have seen chief executive Dianna Hunter step down after issuing a string of profit warnings and revealing a £30m tax bill.

The firm was forced to try to tap up investors for £125m as a result, but it has been unable to convince them of its long-term future.

The group said that secured creditors of the business can appoint administrators without notice.

According to the company’s most recent annual report published last August, Conviviality employs more than 2,600 people and has more than 700 retail stores trading primarily as Bargain Booze, Select Convenience and Wine Rack, alongside 352 franchises.

Conviviality supplies more than 25,000 restaurants, hotels and bars - including Wetherspoon - more than 700 franchised retail outlets, and over 400 independent specialists. It also caters to festivals and events, as well as major supermarkets.

It has been reported that parts of the business could be close to a potential sale, but Conviviality has warned many of the pubs it supplies through its Matthew Clark distribution division could face short-term supply issues.

It is understood accountancy giant PwC is being lined up as administrator if a buyer isn’t found.

The company’s collapse would cap a nightmare quarter for the retail sector.

Since January, Toys R Us and Maplin have filed for administration, while fashion retailers such as New Look and Select have embarked on radical store closure programmes.

Piling on the misery has been the under-pressure casual dining sector, with Prezzo, Byron and Jamie’s Italian all shutting restaurants and slashing hundreds of jobs. </s> More than 2,500 jobs are at risk as the owner of discount chain Bargain Booze as it looks set to go into administration.

It comes after the company, Conviviality, failed to raise £135m from an emergency cash call, according to Sky News.

PricewaterhouseCoopers are likely to be appointed as administrator from tomorrow onwards.

Conviviality shocked investors earlier this month after revealing a £30m tax bill and are now unable to raise sufficient funds to keep it afloat.

Bargain Booze, which has several stores across Devon - including one in Exeter, one in Exmouth, one in Paignton and five in Plymouth - is experiencing its lowest share price since it floated on the market.

Its shares have since been suspended after the tax bill was disclosed to the stock market, leaving it with a market value of just £185m.

The news comes just days after the departure of chief executive, Diana Hunter.

In addition to Bargain Booze, Conviviality also owns the Wine Rack chain and the drinks wholesaler Matthew Clark.

However, a number of suppliers are understood to have deserted the company, which had held the title as the UK’s biggest alcohol wholesaler last year.

As they supplied drinks to thousands of pubs, it undermined Investec's efforts to raise the new funding.

It supplies more than 700 off licences and 23,000 pubs and restaurants across the country, and employs more than 2,600 people.

Earlier this month, the company claimed that the margins in its wholesaler division had softened across January and February, and it was now expecting this weakness to continue for the remainder of the financial year.

A spokesman said: “A number of enhanced controls and disciplines have been introduced to address this and management believes that appropriate corrective actions are in place.” </s> The accountancy watchdog said this morning it has kicked off an investigation into KPMG's audit of Conviviality's financial statements for last year.

Conviviality entered administration in April after two profit warnings which it said stemmed from accounting errors.

The Financial Reporting Council said it had launched the probe into the financial statements of the wine retailer and supplier for the 52 weeks ended 30 April 2017, and the investigation will be conducted under the audit enforcement procedure.

Read more: KPMG could face questions over its work for Conviviality

The FRC has also started an investigation under the accountancy scheme into the preparation and approval of Conviviality's financial statements and other financial information by a member of the Institute of Chartered Accountants in England and Wales.

We note today’s announcement by the FRC of its investigation of the preparation, approval and audit of the financial statements of Conviviality for the year ended 30 April 2017. We believe we conducted our audit appropriately and will co-operate fully with the investigation. As reported by the company, it experienced margin weakness at the start of 2018 and also a significant payment to HMRC which had not been included within its short term cash flow projections, creating a short term funding requirement. Our audit of the company’s financial statements for the year ended 30 April 2018 had not yet commenced at the point which administrators were appointed.

Conviviality's first profit warning was due to an arithmetical error in its accounts, while the second related to an unpaid tax bill.

The company ceased trading on London's junior market prior to the second announcement, and looked to shore up a rescue plan as its cash flow was hit.

Chief executive Diana Hunter stepped down in March amid the troubles, and after unsuccessful attempts to save the company with a fundraising backed by drinks giant AB InBev, the company appointed administrators.

Magners owner C&C Group snapped up Conviviality's wholesale business while Bestway swooped for the retail divisions of the company, including Bargain Booze, in a £7.5m deal.

Read more: Last orders: Conviviality has officially fallen into administration </s> Thousands of jobs could be put at risk as the owner of Bargain Booze heads for administration, according to reports.

Conviviality, which owns the company, has failed to raise £123 million in a shares offer , Sky News states.

They say it is likely to lead to PricewaterhouseCoopers being appointed as administrator on Thursday.

The Bargain Booze chain has more than a dozen stores across North Wales although these are run on a franchise model. </s> A raft of fund managers stand to lose out as Bargain Booze owner Conviviality (CVRC) said it intended to appoint administrators within 10 days 'unless circumstances change'.

Just before Easter the drinks retailer, which also owns Wine Rack, said it failed to raise £125 million from investors to resolve a cash crisis. This had been caused by 'an arithmetic error', which meant a £30 million tax bill was not accounted for and profit forecasts had been overstated by £5.2 million.

Conviviality also highlighted margin pressure within its wholesale business. After two profit warnings, shares in the Alternative Investment Market-listed company were suspended on 14 March and remain so.

The board said shareholders were likely to receive 'little-to-nil' value for their shares, which will hurt investors who were unable to sell out before the suspension. They include George Luckraft, manager of the £295.5 million AXA Framlington Monthly Income fund.

Daniel Hanbury represented another backer. At the end of February, 1.9% of his £786.9 million River and Mercantile UK Equity Smaller Companies fund was invested in Conviviality. The team sold down the position during the preceding months and it is understood that they disposed of more shares before the trading suspension was put in place. Nevertheless, they have been left with a residual holding in Conviviality.

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Other investors proved more fortunate: Old Mutual UK Smaller Companies Focus manager Nick Williamson was able to sell his fund's position in Conviviality after the first profit warning. It had previously represented a top 10 position in the portfolio.

Likewise, Downing Monthly Income manager James Lynch sold the fund's 3.3% position in the off-licence business at around 108p per share after the first profit warning.

'Obviously it is disappointing to see another UK firm with a high street presence fail so quickly and dramatically. However, our investment process is such that when the fundamentals of an investment change we take decisive action,' a spokeswoman commented.

Citywire A-rated Fraser Mackersie and Simon Moon feature among the fund managers who held stakes in Conviviality at the end of February. It represented 3.1% of their £688 million Unicorn UK Income and 2.6% of their Acorn Income (AIF) investment trust.

Unicorn Asset Management declined to comment. </s> July 3 (Reuters) - Britain’s accounting watchdog said on Tuesday it began an investigation into the audit by global auditor KPMG of the financial statements of drinks firm Conviviality Plc, which entered administration in April.

The Financial Reporting Council (FRC), which is probing financial statements for the year ended April 2017, also said it was looking into the preparation and approval of Conviviality’s financial statements and other financial information by a member of the Institute of Chartered Accountants in England and Wales (ICAEW).

Conviviality is Britain’s largest franchised off-licence and convenience chain, operating stores under the Bargain Booze and Wine Rack brands. (Reporting by Noor Zainab Hussain in Bengaluru; editing by Carolyn Cohn)
Conviviality PLC, owner of Wine Rack and Bargain Booze, announces it has been refused investment to stave off bankruptcy and will likely enter administration.