BWG's chief executive officer Leo Crawford is waiting for news on a sale of J&J Haslett, the group's Mace symbol group and cash and carry business in Northern Ireland. An announcement is imminent, but he laughs: "You never know, though look what happened when Pernod Ricard decided to sell BWG." He has a point. That sale process dragged out nearly two years, just one of the many mergers and acquisitions Crawford has weathered in a 23-year career. "One thing about this business is things are always changing, there's never a dull day."
There has been plenty of change since the one-time cost accountant became chief executive officer of BWG in 1999, taking over at a time when the Irish wholesaler was on an aggressive acquisitions drive. That programme came to an abrupt halt when, in December 2000, Pernod Ricard, announced plans to sell off all non-core businesses, including BWG, to help defray the cost of acquiring a huge chunk of Seagram's wine and spirits business. But although Electra Partners was identified as a serious bidder by September 2001, it took another 10 months before the management buyout, funded by Electra, was completed.
Crawford says: "Once the transaction was complete, given that there was a long due diligence period, we were quite clear on what our strategy was going to be. We really wanted to focus on our symbol brands and saw Spar and Bargain Booze, in particular, as offering significant opportunities for growth."
Since then BWG has set about shedding the less profitable parts of its business notably Key Lekkerland delivered wholesalers AR Daunt, T&A Symonds and EV Saxton in England. Crawford says: "Given that we didn't have complete control of the Key Lekkerland group, and that a large degree of those businesses' turnover was tobacco-related with low margins, we felt that we really preferred to service symbol retailers rather than the independent trade in the UK."
Those divestments were not too surprising. But more than a few eyebrows were raised when BWG agreed to enter talks with former rival Hendersons over the sale of J&J Haslett in a deal that would see Spar taking over the local Mace chain. Rumours of possible deals are not new. Nevertheless, it still caught many by surprise when details were announced in May. But one industry expert pointed out such a move made sense because the Northern Ireland market had become very crowded, with intense competition from the mainland multiples, and the deal would create a much more solid wholesaling base (The Grocer, May 17, p8).
Scottish wholesaler Bellevue is also run as part of Haslett, but is not part of the equation. "It is a very tidy business at the moment, it is showing off good cashflow and performing well," says Crawford.
One of the many criticisms of BWG in the past has been the apparent scattergun approach to deal-making as it looked for growth through acquisition. But with the divestment of a number of its businesses, a more coherent strategy does seem to be in place. And Crawford acknowledges that the emergence of a leaner, meaner machine will benefit the remaining parts of the group. As far as BWG's jewels in the crown, Bargain Booze and Spar, are concerned, Crawford cannot conceal his excitement as he reels off some projected growth figures. In the Republic, for instance, BWG has embarked on a E200m, three-year expansion of Spar. In England, the plan is to open 100 Bargain Booze off-licence franchises this year and 50 to 75 a year in 2005 and 2006, radiating out from the Crewe epicentre of the business. "I think we have a lot of demand for Bargain Booze in what we call its hinterland, which is the north west and up as far as the north east. There are no plans at the moment to go into Scotland, but we will eventually look at it."
Further ahead, there are clearly questions as to what BWG's investors will want to do with their stake. Electra is likely to cash in its chips sometime around 2006, says Crawford, but there are no plans yet for BWG's future post-Electra.
"Although venture capitalists do tend to look at three to five-year terms, we are not even a year into the new situation. My function is to grow shareholder value, not to look at investment options." Indeed, the relationship between BWG and Electra is strong, he says. "It's no harm to have the accountancy and financial background I have, given the shareholders that we have."
A man with a passion for management, sales and marketing, Crawford took business studies at Trinity College in Dublin. He then joined then BWG parent Irish Distillers as an accountant. His interest soon waned, however, and after 18 months he decided it was time to get out of accountancy and into what he really wanted to do. He moved across to the company's sales and marketing department, working on brands like Jameson and Blackbush and getting involved in the strategic side of things.
As Irish Distillers went through its long takeover by Pernod Ricard, he went back to central finance. In 1991, two years after Pernod Ricard acquired it, he was made finance director, at the same time becoming non-executive director of BWG, representing Irish Distillers on the BWG board. "I grew very interested in the BWG business, so after five years I joined BWG in the Republic of Ireland as MD, and in 1999 I was made chief executive of the whole group."
These days, Crawford spends a great deal of time on the red eye travelling from BWG's Dublin base to its various UK operations. As well as Bargain Booze, he regularly visits the BWG-owned Spar wholesaler Appleby Westward near Plymouth.
Business has been booming at Appleby Westward since the Electra buyout, Crawford says.
And, he insists, there's no reason why those wholesalers operating in the symbol group arena should not continue to flourish despite the incursions of the major multiples into the convenience sector.
"It's ironic that the Tesco acquisition of T&S and the Co-operative Group's acquisition of Alldays has created all this doom and gloom. But that has been a real shot in the arm to Spar in the UK. You've got these multiple operators who are independent, saying now's the time maybe to join a symbol. I think it's going to be an interesting play over the next three or four years."