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C&C Group Acquired UK Distribution Business For Less Than Half The Value

Published on Jun 25 2019 9:50 AM in Drinks tagged: Featured Post / C&C Group / Matthew Clark Bibendum / Davy Stockbrokers

C&C Group Acquired UK Distribution Business For Less Than Half The Value

It has been reported that the C&C Group acquired the Matthew Clark and Bibendum distribution business for less half of its implied €330 million intrinsic value.

In April 2018, the Bulmers maker paid only a nominal sum for Conviviality's wholesale arm Matthew Clark and its wine, spirits and craft beer distributor Bibendum, as well as four smaller businesses belonging to the two.

As well as the fee, the C&C Group injected a ‘substantial amount’ of working capital into the business and took on some of its debt.

An Important Step

According to the Irish Independent, Davy Stockbrokers believe that the deal was for a sum of around €178 million.

“The acquisition of Matthew Clark Bibendum (MCB) materially enhances C&C's position across the UK drinks supply chain,” the group said in a report.

It added that the transaction marks an important step in the strategic evolution of the group and one that solidifies C&C's branded wholesale model.

“Fundamentally, MCB enhances the defensibility of C&C's business model and delivers both tangible and intangible synergistic benefits to the broader group and its stakeholders.”

In May of this year, the C&C Group reported that organic net revenue increased by 3.2% and its operating profit was up 3.3% during the 12 months ending 28 February.

The group said that it had a transformational year, adding that the group had struggled to access wider UK on-trade in the past, but that the “acquisition of Matthew Clark and Bibendum changes this dynamic”.

© 2019 Checkout – your source for the latest Irish retail news. Article by Aidan O’Sullivan. Click sign-up to subscribe to Checkout.

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