Conviviality seeks £125m to recapitalise business

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Conviviality has triggered an equity placing to raise £125m from investors in order to recapitalise the business.

The directors believe the £125m ’placing’ will provide the capital to resolve overdue payments with its creditors, settle payments with HMRC and repay the company’s £30m revolving credit facility.

If the Bargain Booze owner raises the funds, the directors will make an open offer of up to €5m to all Conviviality shareholders, which would allow those who could not participate in the placing to invest.

However, the company warned that if it is unable to raise the necessary funds, “it is unlikely to be able to trade on a going concern basis”.

Should the placing prove successful, the Board expects that the adjusted EBITDA for the year ending 29 April 2018 to be in the range of £45.5m to £46.0m and net debt to be below £100m.

This is below the previously expected adjusted EBITDA of between £55.3m - £56.4m, which the company announced on 13 March. Net debt was expected to be £150m.

Former chief executive Diana Hunter announced her resignation on Monday.

The shares of Conviviality Plc remain suspended pending further notice. 

Readers' comments (3)

  • Costcutter retailer seeks cash to recapitalise business. A few Qaida will do.

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  • A few what?

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  • Any jobs going..... great taking money for old rope.... numbers not a strong point.

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