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 shedding nearly a quarter of its establishments. Stonegate executives have been in talks with potential advisors regarding this potential sale, as first reported by The Times.
Reports indicate that Stonegate might put up 1,034 of its prized “platinum” pubs for sale, with an estimated combined value of up to £1 billion. Despite achieving a turnover exceeding £1.7 billion last year, the company is burdened with debts exceeding £3 billion.
The significant debt accumulation stemmed largely from Stonegate’s acquisition of Ei Group in 2019, which occurred shortly before the COVID-19 pandemic necessitated the closure of pubs nationwide.
A spokesperson from Stonegate informed The Mirror that they are exploring various options for the Platinum portfolio, which includes approximately 1,000 Leased and Tenanted pubs. These options may involve refinancing, a partial sale, or a full sale of the Platinum sites. However, no definitive decisions have been made yet, and the company continues to progress with its transformation strategy.
Notably, in 2023, Stonegate attempted to sell a similar number of pubs without success. Subsequently, the company refinanced 1,000 venues with a £638 million loan from private equity firm Apollo. The non-call period on this loan, which currently restricts Stonegate from selling the pubs, is set to expire in January.
Established in 2010 after the acquisition of 333 pubs from Mitchells & Butlers by private equity firm TDR Capital for £373 million, Stonegate remains a prominent player in the pub industry. Recently, the company listed 23 pubs for sale, with Savills managing the sales process. This action followed reports in The Telegraph indicating collaboration with restructuring specialists from AlixPartners.
When asked about these divestment activities, a Stonegate spokesperson underlined that the company routinely reviews its portfolio for potential opportunities, emphasizing that the current sales process is a standard transaction.
In other pub-related news, Tim Martin, the head of Wetherspoon, expressed intentions to minimize price increases despite generating revenues of £2.13 billion in the past year. Martin emphasized the challenge of maintaining prices amid tax hikes affecting the broader pub sector, while also highlighting potential impacts from governmental cost escalations, particularly in energy-related expenses.
