Tennent’s owner in pre-pack deal for part of Conviviality

● Dublin-based C&C buys wholesale arm of troubled Bargain Booze owner

the Irish group behind Tennent’s Lager, has bought the wholesale arm of stricken drinks business Conviviality in a pre-pack administration deal which is expected to save hundreds of jobs.

Under the deal, which is also being backed by Belgian brewing giant AB Inbev, C&C has acquired brands Matthew Clark, Bibendum, Catalyst, Peppermint, Elastic and Walker&wodehouseforanominal sum. Conviviality confirmed last week that it planned to appoint administrators after a string of profit warnings and the discovery of a £30 million tax bill, putting 2,600 jobs at risk.

Under the terms of the deal, it is understood that the wholesale arm has been ringfenced from the retail unit, which is still being touted for sale.

It is unclear how many jobs would be saved as a result of the C&C deal, but the division employs up to 2,000 people.

AB Inbev will provide additional financial support to the transaction. PWC handled the sale and administration process.

Stephen Glancey, chief executive of C&C, which also owns Magner’s Cider, said: “We know the Matthew Clark and Bibendum businesses very well.

“They are great businesses with unparalleled on-trade market access, a wide range of supplier relationships and supported by a knowledgeable and loyal employee base.

“The last few weeks have been challenging for employees, customers and suppliers alike. We hope today’s announcement can put an end to this period of disruption and uncertainty.”

C&C added that the deal will create the “leading independent route-to-market network across the British Isles”, providing direct access to 23,000 customers including hotels, restaurants, pubs, clubs and bars.

Matthew Clark is the largest independent drinks distributor in the UK, supplying thouc&c, sands of pubs, while Bibendum is one of the largest wine, spirits and craft beer distributors and wholesalers in the country.

Bargain Booze will not be included in the deal as it sits in Conviviality’s retail division. The firm said yesterday that it is in discussions with a number of parties interested in the purchase of the retail business.

Speculation earlier this week suggested a Chinese private equity firm was a front runner to buy part of the business in conjunction with senior managers.

Conviviality operates more than 700 retail stores trading primarily as Bargain Booze, Select Convenience and Wine Rack.

Last month chief executive Diana Hunter stepped down after the firm issued a string of profit warnings and the unexpected tax bill news.

Shares have been suspended since Conviviality disclosed the tax bill, which created what it called a “short-term funding requirement”.

It was forced to ask investors to stump up £125m, but was unable to convince them.