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Conviviality seeking buyer for retail business
UK drinks wholesaler Conviviality has said it is continuing to “pursue opportunities” for its retail business following the sale of Matthew Clark-Bibendum to the C&C Group yesterday.
Having appointed administrators from PricewaterhouseCoopers to Conviviality Brands yesterday (4 April), the company said that it was still looking for a buyer of its retail operations that include Bargain Booze and Wine Rack.
Following the appointment of administrators, Conviviality’s direct business arm, including Matthew Clark and Bibendum and several subsidiaries, were sold off to Magner’s producer C&C Group, with financial backing from brewing giant AB InBev.
In a statement sent out yesterday afternoon, Conviviality announced that according to the terms of the acquisition deal; all trade creditors to Conviviality Direct can expect to be paid in full, continuity of supply was “assured” as were the 1,900 jobs across the former Conviviality Direct business.
Further updates are expected.
I guess the game is really up. Feel sorry for the shareholders.
Still, investors should have spotted red flag after red flag in the company and before it reported their first profits warning. For example, one red flag dealt is falling operating cash flow. That fell from £7.3m to £528k, a big signal that profits aren’t translated into cash flow.
A lesson all investors should learn.
I think by the time the first profits warning came in things moved so fast many investors may not have reacted quick enough.
What is needed however is a thorough stock market investigation into why the company got themselves into this situation and seemingly it came as a surprise. Points to either a lack of controls or they were not honest about the true state of the company in their announcements. If the latter that has very serious implications for those responsible.Some big questions to be answered and the investors deserve to get to the truth.