Overcast

Overcast

max temp: 27°C

min temp: 17°C

Search

Bury St Edmunds: Greene King agrees £75.6m deal to sell 275 pubs to new operator Hawthorn Leisure

10:22 01 May 2014

Rooney Anand, chief executive of Greene King

Rooney Anand, chief executive of Greene King

ADAM SMYTH PHOTOGRAPER

Greene King today announced the sale of 275 of its pubs in a deal valued at £75.6million.

The Bury St Edmunds-based pubs and brewing group is selling the properties, which area spread around the UK, to Hawthorn Leisure, a new operator backed by Avenue Capital Group and May Capital LLP.

Hawthorn has also agreed a three-year beer supply deal for the pubs, which Greene King said would secure valuable nationwide distribution for its portfolio of ale brands.

The deal, which is expected to complete by early June, involves tenanted and leased properties classed by Greene King a “non-core”.

It has been scaling down its tenanted and leased estate in recent years to improve average earnings within its Pub Partners division and indicated today that further disposals could be on the cards, saying it now plans to reduce the estate to around 750 compared with a target of 1,200 originally set in 2010.

At the time of its half-year results in December, Greene King owned a total of 2,226 pubs, restaurants and hotels, consisting of 1,218 within Pub Partners and 1,008 within its directly managed retail division which includes brands such as Hungry Horse, Old English Inns, Eating Inn and Loch Fyne.

Greene King, a member of the EADT/EDP Top100 listing of the 100 largest companies in Suffolk and Norfolk, said the sale of the pubs which carry a book value of £93.8m and generated earnings of £12.4m last year would also further strenthen its balance sheet and provide an opportunity to accelerate investment and expansion within the faster-growing retail sector.

Rooney Anand, Greene King chief executive, said: “We are pleased to have agreed this transaction with Hawthorn Leisure. Our strategic plan, announced in July 2010, was to reduce our tenanted and leased estate to 1,200 sites.

“We believe that a smaller estate than originally envisaged is now more appropriate going forward as we move increasingly to higher growth areas in our markets and to improve the customer offer.

“The retained Pub Partners estate represents a high quality, cash generative business, although it is likely to become smaller still as we transfer some sites back to retail and seek to dispose of additional sites in the estate to improve both yield and returns. We now expect to reduce the estate to around 750 sites.

“It is a sign of the strength of the business and our balance sheet that we have several options for the funds raised through this sale. Depending on site availability and attractive valuations, our first priority will be to seek to further accelerate our retail expansion plans.

“In the absence of increased investment opportunities, we would also retain the option of using the funds to reduce our overall longer-term gearing position.”

3 comments

  • Thirty years ago, Greene King, along with Adnams were a godsend to these parts as they continued to battle against the likes of Grand Met and their terrible keg beer. Now GK have changed sides and few ale drinkers will be delighted to find a pub just serving their wide range of mediocre beer. I walked into and out of a pub in Wales at the weekend that only had IPA and Speckled Hen on. I made sure the whole pub knew that I hadn't driven 250 miles across the country to be assailed with rubbish like that. Luckily the next village was overflowing with Purple Moose! This story is a total non-event. 275 pubs will still be selling GK beer.

    Report this comment

    Tom Jeffries

    Monday, May 5, 2014

  • Anyone notice a phrase in the third paragraph from the end. "Transfer some sites back to retail and seek to dispose of additional sites". To me that sounds like more pub closures and yet more Tesco express" type shops popping up.

    Report this comment

    The original Victor Meldrew

    Saturday, May 3, 2014

  • "Hawthorn has also agreed a three-year beer supply deal for the pubs, which Greene King said would secure valuable nationwide distribution for its portfolio of ale brands." Pity - I'll still have to avoid them even when they've been sold.

    Report this comment

    beerlover

    Friday, May 2, 2014

The views expressed in the above comments do not necessarily reflect the views of this site

Gambling addict damaged machine

A gambling addict flew into a rage and damaged a £1,000 fruit machine after losing money at an Ipswich amusement arcade, a court has heard.

Friends and family gathered in Holbrook to give Sam Hall a heroes welcome. Sam has just cycled the length of France in order to raise money for charity in memory of his late brother, Archie Hall.
L-R William and Henry Bawley, Laura Hall, Sam Hall, Eve and John Hopkins.

Sam Hall was given a hero’s welcome by friends and family last night as he arrived at his Holbrook home after completing a 900-mile cycle ride in memory of his brother.

Pupils sitting an exam. Photo: Niall Carson/PA Wire

Girls are expected to yet again outperform boys on GCSE results day this year.

GCSE Results Day - St Benedict’s Catholic School in Bury. Left to right, Tia Lowman, Niall Morris, Rachel Ellis, Georgina Coll, Peter Bryan, Ben Campbell, Abin Jose.

Youngsters across Suffolk will this morning end their anxious wait as they pick up their GCSE results.

Marcus Evans

Brazilian police investigating allegations of Olympic ticket-touting have released emails between a senior Irish official and Ipswich Town Football Club owner Marcus Evans.

Tower Ramparts, Ipswich, as staff poured from William Prettys works in the mid 1890s

The site of one of Ipswich’s major employers until the 1980s - Willaim Pretty’s - is now a car park, writes David Kindred.

Andrew Bloomfield took this photo of Suffolk Fire and Rescue Service fighting the fire in the old Fisons building in Paper Mill Lane, Bramford.

A fire at the old Fisons building in Paper Mill Lane, Bramford, has been extinguished.

South East Suffolk Magistrates' Court

A rap-loving noisy neighbour has been taken to court for continually disturbing his Ipswich neighbours with his music.

Ben Gummer, left, at the Suffolk Chamber of Commerce and EADT EU referendum debate at UCS in Ipswich

In the third of five three-minute interviews, Ipswich MP Ben Gummer reflects on the European Union referendum and what it means for the town.

Aldeburgh beach was packed with people enjoying the sun on Wednesday 24th August.
L-R Chris and Jane Linford,Jan and Ken Garratt.

With the school summer holidays drawing to an end East Anglia’s tourist hotspots are gearing up for bumper crowds looking to make the most of the bank holiday weekend.

Most read

Most commented

HOT JOBS

Show Job Lists

Topic pages

Streetlife

Newsletter Sign Up

MyDate24 MyPhotos24