Majestic Wine buys Naked Wines

Majestic Wine is taking over smaller online rival Naked Wines.

The move will also see Naked Wines founder, Rowan Gormley, taking over as chief executive of the overall company. Majestic's previous chief executive, Steve Lewis, left the post in February.

Majestic said the £70m deal would combine Naked Wines' online and e-commerce skills and Majestic's national store network.

It also said trading in March was weak. Its shares fell 6% in early business.

Rowan Gormley has founded a number of high-profile businesses. As well as Naked Wines, which started business in 2008, he was also behind the launch of Virgin Wines, the Virgin ONE Account and Virgin Money.

Majestic also plans to expand further in the US and Australia.

The two will continue to operate as independent brands.

Kate Calvert, analyst at Investec, said the takeover was a good move: "Both businesses have much to gain from each other. We expect Mr Gormley to look to unlock Majestic's online potential."

Profit guidance

Naked Wines acts as a form of wine club and is a prolific user of social media on which its customers and wine producers are encouraged to communicate.

It has more than 300,000 customers, compared with Majestic's 640,000.

Majestic said same store-sales had risen by 1.5% since Christmas, but that although January and February's trading was in line with expectations, March's was weaker.

Majestic said that this sales performance, coupled with "adverse foreign exchange movements in March", meant Majestic would announce adjusted pre-tax profit of approximately £21m in June.