Conviviality chairman David Adams has aimed to quash fears that Conviviality will go under following a disastrous week that cost chief executive Diana Hunter her job.

Adams has stepped into the role of executive chairman today and he has begun his search for a new chief executive to lead the business.

He pledged that Conviviality will be around “for years to come” and shrugged off the current turmoil as a “short-term challenge”. 

Adams said: “We’re a profitable business, with the very best route to market in the UK, and our suppliers, franchisees, producers and customers know this.

“We’re very grateful to have so many people across the industry stand by our side and rally around us as we overcome this short-term challenge.

“We’ve been heartened by the support and will continue to talk openly to everyone we’re working with.

“These are relationships we intend to have for years to come.”

Hunter stepped down from her role yesterday after Conviviality, once the darling of the City, unravelled spectacularly in less than a week.

First it issued a profit warning saying an “arithmetic error” has caused a £5.2 million hole in its accounts. Then it announced it had failed to pay a £30 million bill to HMRC, due at the end of this month.

Within an hour, more than £300 million was wiped off its stock market value and shares were frozen at 101p, less than a quarter of their November 2017 high point. It also scrapped an dividend of 4.5p per share, which was due to be paid on March 16.

The company now has to raise more than £150 million in an emergency rights issue to shore up its finances, before credit insurers come in to assess whether or not it is a risk to suppliers.

Hunter has fallen on her sword, but will remain with the company for “a period of time” in order to provide “transition support”. Speculation abounds that the entire management team and the board will be replaced as investors face up to painful paper losses on their investments and demand change.

But the group said the current leadership team will continue to run the business on a day-to-day basis.

Commercial director James Lousada, a drinks industry veteran who has formerly served as chief executive at Carlsberg UK and general manager for Europe at Accolade Wines, is temporarily stepping up to a more senior role.

Buying and insights director Steve Jebson, operations director Mark Riley and people director Sarah Miles will all report in to Lousada as an interim measure.

Mark Moran will continue in his role as chief financial officer, while David Robinson will continue to serve as managing director of the group’s retail estate.

Adams said: “We’d like to express our thanks to Diana for her vision, drive and market understanding that has created the Conviviality we are today, with its clear route to market strategy for our suppliers and customers.”