Punch and wine company Constellation form joint venture

The UK’s largest pub operator Punch Taverns and the largest wine company in the world, Constellation Brands, have formed a joint venture to take control of drinks wholesaler and distributor Matthew Clark.

Punch and Constellation Europe (the division of Constellation Brands formed in April 2004 through the merger of Constellation Wine Europe and Matthew Clark) will form a holding company with 50/50 ownership of Matthew Clark.

The joint venture values the wholesaler and distributor at £120m with Punch matching Constellation’s retained investment of £35m.

The remaining balance of £50m exists as non-recourse debt (a secured loan linked to collateral).

Steve Thomson, current director of wholesale at Matthew Clark, will continue to run the business independently.

Giles Thorley, chief executive at Punch Taverns, said: “This is an innovative joint venture between the UK's leading pub operator and a leading global producer and marketer of branded alcohol, with all the benefits of scale and reach you would expect.

“[The deal] will bring multiple benefits to Punch's tenants and lessees in terms of products and services and has the potential to deliver attractive financial returns for shareholders.”

For the year ending February 2007 Matthew Clark reported turn over £550m with a pre-tax profit of £15m.

Matthew Clark is the sole wine distributor to JD Wetherspoon.

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Matthew Clark website >>

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By Christopher Walton

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