Alcohol chain Bargain Booze to go into administration

Bargain Booze outlets are facing risk of closure
Bargain Booze outlets are facing risk of closure
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Discount alcohol chain Bargain Booze is on the brink of collapse, putting 2,500 jobs at risk.

Chain owner Conviviality has said it intends to appoint administrators within the next 10 business days “unless circumstances change”.

The group added secured creditors of the business could appoint administrators without notice.

Conviviality also owns Wine Rack and supplies more than 25,000 restaurants, hotels and bars.

The firm has issued profit warnings in recent weeks and revealed a £30 million tax bill.

The company sought £125m from investors, but said it had been unable to raise those funds.

Conviviality employs about 2,500 staff and their jobs are now in jeopardy.

The company had slashed its profit forecast for this year to £55m from £70m earlier this month.

READ MORE: Two Scottish Prezzo restaurants to shut as chain axes jobs

Conviviality said it would continue trading over that period in the hope of preserving “as much value as possible” for its stakeholders.

It will keep working alongside advisers and said it is exploring “a number of inbound enquiries regarding a potential sale of all or parts of the business”.

“Following discussions with its lending banks, the board has resolved to file notice of intention to appoint administrators to the company,” Conviviality said in a market announcement.

“Unless circumstances change, and in accordance with statutory requirements, the board intend to appoint administrators within 10 business days.”

Over the past few weeks, the firm has seen its chief executive Dianna Hunter step down after issuing a string of profit warnings and revealing the £30m tax bill.

Ms Hunter, a former Waitrose director, had been chief executive since 2013 and led the group through its stock market flotation in the same year.

She also oversaw a number of acquisitions, including Wine Rack, Matthew Clark and Bibendum.

Non-executive chairman David Adams has taken her place until further notice.

The company’s collapse would cap a nightmare quarter for the retail sector.

Since January, Toys R Us and Maplin have filed for administration, while fashion retailers such as New Look and Select have embarked on radical store closure programmes.

Piling on the misery has been the under-pressure casual dining sector, with Prezzo, Byron and Jamie’s Italian all shutting restaurants and culling hundreds of jobs.