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S&N retail sold to Spirit consortium for £2.51bn
Scottish & Newcastle plc (S&N) has sold its managed pubs, restaurants and lodges business (S&N retail) to the consortium-led Spirit Amber Bidco group for £2.51bn.
The Spirit company was formed by a consortium and led by the Spirit pub group. It also comprised private equity firms CVC, Texas Pacific, Merrill Lynch and the Blackstone group. The company is to be renamed Spirit Amber and will now employ over 46,000 people with a pub portfolio that numbers 2,500 sites.
The S&N estate that was up for auction had over 1400 sites, including the Bar 38 and Chef & Brewer brands alongside the Premier Lodge hotel group and the Tom Cobleigh chain. Rival bids in the tightly contested auction included Nomura International, the PAI group and the Laurel Pub Company, whose bid was backed by Cinven.
The reason for the auction was to enable the S&N group to strengthen its operating position within the international brewing business.
According to Scottish & Newcastle, their future international strategy will be particularly focused on markets in Russia, the Ukraine, India and the United States, where S&N is believed to have “a high potential for organic growth”.
The transaction should be completed during November 2003, although it is subject to approval by S&N shareholders.
Chief executive of S&N, Tony Froggatt, said: “The successful sale of S&N retail is a key step in the group’s strategy of focusing on its brewing business. The proceeds from the sale will be used to reduce debt, strengthening the financial position of Scottish & Newcastle. 0This will enable us to develop and drive value from our existing European platform, whilst continuing to build on our established position in other markets.”
The chairman of Spirit Amber, Tony Campbell, added: “We are delighted to acquire such a high quality business with great pubs and great people. I am confident that the business will continue to prosper as part of the new group.” Details: www.scottish-newcastle.com