The UK's largest cider company, HP Bulmer, is negotiating to buy a Scottish distribution company in a bid to boost the presence of its Strongbow and Scrumpy Jack brands in both the on- and off-trade in Scotland.

Bulmer believes such an acquisition in Scotland will complement its Beer Seller distribution operation in England. The value of the deal is thought to be in the low millions because of the company's high borrowings. Bulmer CEO, Mike Hughes, has not commented on the deal other than to say that the company is looking at a "possible acquisition" in Scotland.

The news follows HP Bulmer's disappointing annual results, which saw a 26% slide in pre-tax profits before goodwill and exceptionals to £21.1m. The company also announced this week that it is to pull out of South Africa and trim back its US operations.