The owner of Bargain Booze is on the brink of administration, putting 2,600 jobs at risk, after it failed to raise £125m from an emergency cash call.

Conviviality said in a statement on Thursday that it was now intending to appoint administrators within 10 business days as it had been unable to secure sufficient new funds, confirming an earlier report by Sky News.

The company had stunned investors earlier this month when it revealed a £30m tax bill.

PwC would likely be called in, according to insiders, barring a last-minute rescue by banks.

Conviviality said: "Further to the announcement on 28 March 2018, and following discussions with its lending banks, the board has resolved to file notice of intention to appoint administrators to the company.


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

"The secured creditors can, however, appoint administrators without the requirement for notice.

"The directors intend to allow the business to continue to trade and the company continues to work alongside advisers in order to preserve as much value as possible for all stakeholders as it explores a number of inbound enquiries regarding a potential sale of all or parts of the business."

It is understood any sale would likely be through an administration process.

The announcements were made just days after Conviviality confirmed the departure of Diana Hunter, its chief executive, and said it would seek to raise £125m from investors through a placing of new shares.

A number of suppliers are understood to have deserted the company, which supplies drinks to thousands of pubs, undermining Investec's efforts to raise the new funding.

Conviviality's shares had been suspended after the tax bill was disclosed to the stock market, leaving it with a market value of just £185m.

The company, which also owns the Wine Rack chain and the drinks wholesaler Matthew Clark, is a big player in the UK's beverages industry.

It supplies more than 700 off licences and 23,000 pubs and restaurants across the country, and employs more than 2,600 people.

Pub chains with contracts to be supplied by Conviviality reported on Wednesday that key deliveries ahead of the Easter period had failed to show up.

The brewing giant AB InBev had urged shareholders to back the group's fundraising, underlining its importance as a distribution channel for the Budweiser and Stella Artois maker.

Administration would mean the company becomes the latest retail sector failure following the collapse of Toys R Us UK and Maplin.