Stonegate Group, the owner of Slug & Lettuce and Be At One, is considering selling over 1,000 of its pubs. With a total of 4,300 venues in its pub chain, this move could involve letting go of almost a quarter of its locations. The Times initially reported that Stonegate executives have been in discussions with potential advisors.
Reports suggest that around 1,034 of Stonegate’s “platinum” pubs might be put up for sale, potentially fetching a combined value of up to £1 billion. Despite achieving a turnover exceeding £1.7 billion last year, the company faces debts exceeding £3 billion.
The bulk of Stonegate’s debt stems from its acquisition of Ei Group in 2019, which occurred shortly before the onset of the COVID-19 pandemic that led to the closure of pubs nationwide.
A spokesperson from Stonegate informed The Mirror that they are exploring various options for the Platinum portfolio, including refinancing, partial sale, or full divestment of the pubs, clarifying that no final decisions have been made.
This decision follows a previous attempt by Stonegate to sell a comparable number of pubs in 2023, which was unsuccessful. Subsequently, the company secured a £638 million loan from private equity firm Apollo to refinance 1,000 venues. The non-call period on this loan, preventing Stonegate from selling the pubs, is set to end in January.
Established in 2010 after the purchase of 333 pubs from Mitchells & Butlers for £373 million by private equity firm TDR Capital, Stonegate has been actively managing its pub assets. Recently, the company put 23 of its pubs up for sale, with Savills heading the sales process, following earlier reports of collaboration with restructuring experts from AlixPartners.
In other pub-related news, Tim Martin, the CEO of Wetherspoon, expressed intentions to minimize price hikes amidst the company’s £2.13 billion revenue for the year. He acknowledged that some price adjustments may be inevitable due to tax increases affecting the pub industry but emphasized Wetherspoon’s commitment to keeping price increases to a minimum.
Martin further mentioned that while the company anticipates a reasonable financial outcome for the year, potential cost escalations driven by government-led initiatives, such as energy costs, could impact the final results.