SHARES TUMBLE 12pc AS MAJESTIC WINE GOES NAKED

SHARES in Majestic Wine tumbled after it warned it would slash its dividend and put stores up for sale.

In a radical overhaul that stunned investors, chief executive Rowan Gormley said jobs could be lost as its shops are sold or closed. It did not say how many of its 200 stores would be affected. The shake-up will also see Majestic renamed Naked Wines, after its fast-growing online business.

Naked Wines was set up by Gormley ( pictured) in 2008 and bought by Majestic in 2015 in a £70m deal that saw him named chief executive of the combined group. The wine merchant said it will reveal the full extent of the revamp in June, but added that it may need to cut or scrap its dividend to cover the costs of the shake-up.

Analysts at Liberum called the move ‘a drastic and unexpected change in strategy’.

Majestic warned it will book a charge of up to £10m for the restructuring in its annual results, with more charges likely to come in the next year. It will also plough an extra £6m a year into winning new customers at Naked.

Shares fell 12.2pc, or 33p, to 238p.