C&C, the maker of Bulmers, Magners, and Tennent’s lager, has agreed to buy Asahi’s UK wholesale business in a bid to boost sales. The Irish drinks group, listed on the London stock market, said it bought Asahi’s UK business for a nominal sum. This deal comes as C&C reported a slowdown in sales despite the warmer weather.
The deal, expected to complete in October, will include all of Asahi UK’s wholesale customer and supplier relationships and agreements, as well as the intellectual property, a leased depot, and some other assets such as vehicles and stock. The transaction also includes Nectar Imports, a drinks supplier to pubs and restaurants in the south of England, and the direct distribution operations of Asahi UK.
Deal Details
As part of the deal, C&C will merge the Asahi wholesale business into its Matthew Clark Bibendum operations following the deal. Roger White, chief executive of C&C Group, said: ‘This move represents an attractive opportunity to provide a significant number of new customers with MCB market leading service and range proposition whilst simultaneously delivering immediate scale and efficiency into the group’s operations.’
C&C expects the deal to make a small positive contribution to results for the current financial year that runs to the end of February 2027. They said trading over the first half ended August 31 had been in line with forecasts, with net revenues down three per cent year-on-year, as branded sales growth of two per cent was offset by a four per cent decline in distribution turnover.
Financial Performance
Underlying operating profit for the first half is tipped to be €43million to €44million, which the group said was in line with expectations, as it reiterated confidence in hitting consensus forecasts for the full year. The distribution weakness resulted from the planned exit of some lower-margin customer business, along with the ongoing market decline in outlet numbers and certain drink categories.
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C&C’s move to acquire Asahi’s UK wholesale business is a strategic attempt to expand its customer base and improve its market position. Similar deals in the past have allowed companies to increase their scale and efficiency, ultimately leading to improved financial performance. In the context of C&C’s current financial situation, this deal may provide the necessary boost to drive sales growth and achieve its full-year forecasts.
The company’s decision to merge the Asahi wholesale business into its Matthew Clark Bibendum operations is expected to deliver immediate benefits. The combined entity will have a stronger presence in the UK market, allowing it to better compete with other major players in the industry. As the deal is set to complete in October, C&C will likely focus on integrating the new business and realizing the expected benefits in the coming months.
Roger White and his team will be key to the success of this deal.
They have a lot of work to do.
C&C’s financial performance will be closely watched in the coming months.
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