Laurel to sell 432 pubs in £450m move

Managed operator Laurel Pub Company is to sell its estate of 432 community pubs in a deal that could net up to £450m. The deal would leave Laurel with an estate of 177 high street pubs and bars. The community estate had a turnover of £230m and produced earnings of £60m last year before head office costs. Chief executive Ian Payne said: "The view is that the neighbourhood pubs are in extremely good shape and are showing verygood growth, particularly in the Champion estate with double-digit food growth. It makessense to test the market." Punch Taverns, Wolverhampton & Dudley, Greene King and a number of private equity firms are all thought to be potential bidders. Payne added: "It is our intention to concentrate on the high-street division and take the lead in consolidation of this highly competitive area through acquisitions." Laurel is known to be interested in acquiring Wizard Inns. He said: "I'm not allowed to talk about Wizard, having signed a confidentiality agreement. But there's a whole number [of possible targets]." Some industry observers, however, thinks a sale of the remaining high street pubs will follow the disposal of the community estate. One pub company chief said: "I think they'd have too much on their plate to do a double sale. They will, no doubt, take a long, hard look at what's left but it will be very hard to get the overhead structure right. I suspect a sale of the high street pubs could follow in November this year." Payne said: "We're owned by venture capitalists and if the right offer for the high street sites came in tomorrow, we'd sell." Laurel was formed in 2001 when Deutsche Bank bought 3,000 managed and tenanted pubs from Whitbread for £1.6bn. Earlier pubs sales and a sale-and-leaseback deal mean that Deutsche Bank has already recouped its entire investment. "It's been an extremely good return in three years," said Payne. "They're currently in Laurel for free.