Conviviality To Acquire Wine Wholesaler Bibendum For £60m

Conviviality, owner of the Bargain Booze chain, has announced that it has conditionally agreed to acquire Bibendum PLB, one of the largest wine, spirit and beer distributors and wholesalers to the UK on-trade and off-trade markets, in a deal worth £60m.

Conviviality, which last year bought drinks wholesaler Matthew Clark for £200m, said that Bibendum with provide it with a range of complementary businesses serving the on-trade through Bibendum Wine; the off-trade through Walker & Wodehouse; agencies through PLB and Instil Drinks Co.; and events through the Wondering Wine Company.

The acquisition will increase Conviviality’s overall turnover by around 23% with combined annual sales of over £1.4bn. It added that the deal will strengthen the group’s skills and capabilities, specifically in customer insights, producer relationships and old world and premium wines. Conviviality also hopes to benefit from Bibendum’s strong presence in London and the South East.

In its financial year ended 31 March 2016, Bibendum is expected to generate revenues of £270.5m and adjusted EBITDA (before exceptional items) of £6.67m. The company’s said there was opportunities for significant cost synergies to be realised from the combination of Conviviality and Bibendum, particularly in relation to organisational, buying and distribution with scope to also generate incremental revenue across the two businesses.

Diana Hunter, Chief Executive Officer of Conviviality, said: “We are pleased to be acquiring Bibendum PLB as the business will not only accelerate our strategy of expanding our wholesaling expertise into new markets and channels, but brings significant expertise to Conviviality in the off-trade wholesale market through the PLB business. Bibendum PLB’s wine speciality, particularly in old world and premium wines complements our other businesses and helps us to accelerate our leading position in the independent on-trade market.”

She added: “The acquisition of Bibendum PLB accelerates our aim to satisfy all of our customers who want to consume alcoholic beverages at home or out of home, whatever the occasion, serving customers directly via retail outlets and indirectly through hospitality and foodservice channels. We believe the acquisition will give rise to significant potential synergies and increase returns for Conviviality’s shareholders.”

NAM Implications:
  • Apart from some scale purchasing opportunities for Conviviality…
  • Time for suppliers to check out possible prices and terms disparities?
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