C&C acquires Matthew Clark Bibendum
Matthew Clark has a nationwide distribution network of 18 depots and a sales team of over 250 serving the independent free trade and national accounts as well as a state-of-the-art online ordering system.
In the latest audited accounts for the 52 weeks ended 30th April 2017, Matthew Clark Bibendum had gross revenues of £1.22 billion. However, in its trading update of 21st March 2018, the Board of Conviviality plc stated that they expected the adjusted EBITDA for the entire Conviviality group for the year to be in the range of £45.5 million to £46.0 million. The company has gross assets of approximately £230 million.
MCB is the UK’s largest independent distributor to the on-trade drinks sector there, offering a range of over 4,000 products including beers, wines, spirits, cider and soft drinks sourced from over 300 suppliers.
Owned by the failed Conviviality Group (that applied for administration last week) the two UK alcohol distribution units will now be part of the C&C Group and the deal includes Matthew Clark Bibendum’s subsidiary brand representation businesses Catalyst, the outdoor events business Peppermint, Elastic and Walker & Wodehouse.
C&C will provide sufficient funds to support the ongoing working capital and other cash requirements of the business in the meantime with the deal being backed by C&C Group’s distribution partner in the UK, Anheuser-Busch InBev, which will contribute funds. Financial details have not been disclosed.
Conviviality, which also owned the Bargain Booze and Wine Rack retail chains until it was purchased by Bestway Wholesale recently, announced last week that it would seek administration less than a month after issuing a profit warning.
The company, which employs 2,600 people, failed to find lenders for its cashflow issues and sought administration on 29th March with a view to exploring a potential sale of all or part of the business. The announcement coincided with the deadline for payment of a £30 million tax bill that it had overlooked until two weeks previously.
Matthew Clark Bibendum will have £102 million of working capital facilities provided by its current lender group, repayable in instalments over the 12 months following completion and it will be run as a separate business.
C&C management believes the acquisition will:
- create the leading independent route-to-market network across the British Isles alongside C&C’s existing drinks wholesaling businesses in the UK and Ireland
- provide direct access to an incremental 23,000 (approx) predominantly on-trade customers across the UK
- enhance access for C&C’s cider and super-premium brands across the UK’s on- and off-trade
- strengthen the combined Group’s procurement, supply and distribution capabilities for third party wines, spirits, beer and soft drinks
- enhance access in the premium trade sectors, in particular London and the South East, through Bibendum’s expertise in wine
- offer significant revenue opportunities and other business benefits
- offer significant earnings accretion and attractive returns on capital in the first full financial year following completion and
- strengthen relationships with and commitment from all stakeholders including key suppliers.