PwC administrators complete Conviviality sale to save thousands of jobs
In a deal far less scandalous than it sounds, thousands of jobs have been safeguarded by the sale of Bargain Booze. Retail firm Conviviality, which included the budget off-license chain among its portfolio, entered administration at the beginning of April. However, after just a matter of days, PwC administrators confirmed that a £7 million deal with food wholesaler Bestway had been completed, rescuing over 2,000 employees across the UK.
Prior to its administration, Conviviality ran more than 700 retail stores trading primarily as corner shops and off-licenses. These included Bargain Booze, Select Convenience, WS Retail and Wine Rack, alongside 352 franchises, employing more than 2,600 people across Britain. Recent months had seen the retailer experience mounting uncertainty about its future, after issuing a string of profit warnings and revealing a £30 million tax bill, culminating in the resignation of Chief Executive Dianna Hunter.
Due to its desperate situation, the firm was forced into panhandling investors for an emergency injection of £125 million in funds. Similarly to the unpaid tax bill which ultimately led to the demise of the UK wing of Toys R Us, Conviviality was unable to convince its suitors of its long-term future. At the end of March, the group announced that “unless circumstances change” it planned to appoint administrators – a promise it made good on as of the 4th of April, with the appointment of PwC joint administrators Matthew Callaghan, Ian Green and David Baxendale.
In a remarkable turn-around, however, it took PwC’s representatives just three days to find a buyer. Thousands of jobs were declared as saved, following the £7 million sale of Conviviality’s retail division to Bestway. The deal sees the foods wholesaler take control of Bargain Booze, Wine Rack, Select Convenience and WS Retail. PwC had already completed the sale of Conviviality’s Direct business earlier in the same week, lifting the total number of staff whose jobs had been protected to over 4,000.
Joint administrator Matthew Callaghan, a Partner at PwC, said of the purchase, “This deal safeguards the jobs of more than 2,000 employees, ensures franchisees have the ability to continue to trade and creates some much-needed stability for business customers and the sector in general.”
PwC has been involved in a number of high-profile liquidations in recent months. Shortly after Toys R Us announced its lapse into administration, the UK high-street was further hit by the news that Maplin had also collapsed. The group, operating more than 217 stores and over 2,300 staff across the UK and Ireland, has since seen PwC confirm a string of redundancies in its head offices in London and Rotherham. Beyond the world of retail, meanwhile, after the controversial collapse of construction firm Carillion, the Big Four firm was drafted in to oversee its winding down.
