Bargain Booze owner in agreement to buy Matthew Clark

Conviviality Retail has reached an agreement to buy Matthew Clark from Accolade Wines and Punch Taverns for £200 million.

The Bargain Booze owner revealed it was in talks to buy the specialist on-trade wholesaler two months ago and was named as the preferred bidder for the business in mid-August.

The acquisition creates a business with combined turnover of £1.1 billion. Conviviality said it would offer “a compelling route to market for suppliers to access both on- and off-trade retailers”.

It added that it expected to achieve synergies from buying, distribution, organisational efficiencies and additional revenue generation, and that it would be earnings enhancing from the first full year of ownership.

The deal is being funded by a placing of new shares worth £130 million and £80 million of new debt.

Conviviality chief executive Diana Hunter said: “This will accelerate our strategy of expanding our wholesaling expertise into new markets an channels.

“Matthew Clark has a leading position in the independent on-trade market, complementing Conviviality’s position in the off-trade, and the team bring significant on-trade wholesaling expertise and an unrivalled portfolio of high quality and loyal customers.

“By operating a delivered wholesale model we can serve a diverse range of customers and build our wine and spirit volumes further while simultaneously strengthening our retail channel.

“The acquisition will create a major payer in the UK drinks wholesale market and we believe that combing the two businesses will give rise to significant potential synergies.”