Conviviality has to put its shares on ice

Conviviality Retail, the owner of Bargain Booze and Wine Rack, has suspended its shares as it revealed it is in negotiations that could lead to a reverse takeover by Matthew Clark, the nationwide drinks distributor.

Matthew Clark is jointly owned by the pub chain Punch Taverns and Australian private equity firm Champ.

The investment bank Rothschild has been touting the drinks distributor around for a couple of months with a suggested price tag of around £200m. That is twice Conviviality’s current market value with its shares suspended at 155p. The retailer said the suspension would remain in place until either talks end or takeover documents can be published.

Conviviality is expected to have made sales of £364m last year, while Matthew Clark has sales of around £800m and made profits of £25m.

Any deal would be the first move by Punch’s new chief executive Duncan Garrood, who joined last month after a huge debt restructuring took place at the group.