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 potential move could involve letting go of nearly a quarter of its establishments. According to reports from The Times, Stonegate executives have engaged in discussions with potential advisors about this matter.
It is suggested that around 1,034 of Stonegate’s “platinum” pubs may be put up for sale, with an estimated combined value of up to £1 billion. Despite generating revenue exceeding £1.7 billion in the previous year, the company faces debts exceeding £3 billion. The acquisition of Ei Group in 2019 significantly contributed to Stonegate’s debt burden, occurring shortly before the widespread closure of pubs due to the COVID-19 pandemic.
A spokesperson from Stonegate mentioned to The Mirror that the company is exploring various options for its Platinum portfolio, including refinancing, partial sale, or full divestment of the pubs. No final decisions have been made yet, as the company continues to progress with its transformation strategy. In a previous attempt to sell a similar number of pubs in 2023, Stonegate was unsuccessful. Subsequently, the company refinanced 1,000 venues with a £638 million loan from private equity firm Apollo.
The non-call period on the loan, which currently prevents Stonegate from selling the pubs, is set to expire in January. Established in 2010 following the acquisition of 333 pubs from Mitchells & Butlers for £373 million by private equity firm TDR Capital, Stonegate continues to navigate its strategic business decisions.
In related pub industry news, Tim Martin, the head of Wetherspoon, expressed intentions to minimize price increases despite the company’s £2.13 billion revenue for the year. Martin highlighted the impact of tax changes on pricing within the broader pub sector, emphasizing Wetherspoon’s commitment to managing price adjustments carefully.
Looking ahead, Wetherspoon anticipates a favorable financial outcome for the year, acknowledging potential challenges from government-driven cost escalations such as energy prices.