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M&A

US investment firm acquires Majestic Wine in £100m deal

Majestic Wine has entered into an agreement to sell its commercial and retail business to CF Bacchus Holdings Limited, a vehicle controlled by funds managed by Fortress Investment Group, in a deal worth around £95m.

A separate sale of one freehold property previously owned by MWWL to an independent third party is expected to realise a further £5m subject to approval of a planning application for redevelopment, bringing total proceeds to approximately £100m.

Majestic Wine said the transactions represent a “major milestone” in the group’s history, and will help enable the board to “focus on driving growth in the Naked Wines business”.

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It added the money will also be used to eliminate the group’s net debt, which stood at approximately £15.5m at end FY19 and is anticipated to be in excess of £30m when the transaction completes and to return £3.8m to shareholders by way of a special dividend of 5.2p per share.

Commenting on the disposal, Rowan Gormley, CEO of Majestic, said: “I am delighted that we have managed to secure an independent future for both Naked and Majestic Retail and Commercial, allowing both companies to pursue growth by focusing on their unique propositions.

“I would like to thank all staff, customers and suppliers for their loyalty during this process. We look forward to the future and continuing to focus on what we do best, sharing our spectacular wines from our hundreds of talented winemakers with our customers.”

Majestic Wine added it is also currently exploring a number of initiatives which have the potential to increase its rate of investment and growth which includes the potential sale of its Lay and Wheeler business and the separate sale of its freehold of its Ealing store.

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