Mercury Inns in administration
Multiple operator Mercury Inns has gone into administration, the Morning Advertiser has learnt.
Butler (L) and Thornton (R): plan to buy back leases and freeholds
Mercury Inns was formed 12 years ago by co-managing directors Mark Butler, Kevin Thornton and operations director Andrew Chapman.
It runs ten high quality dining pubs including two Charles Wells leased pubs, one Enterprise lease and a number of freeholds.
The operator went into administration on Monday after its bank, Barclays, refused to extend its lending facilities to help repay a VAT and PAYE bill owed to HM Revenue and Customs.
The problems at Mercury were further exacerbated by the return of a toxic lease to it from Yesteryear Pub Co when it went into administration in late 2006.
Harry’s Bar in Chorley had a rent of £100,000 a year on a 15-year lease. “It really came back to bite us,” said Butler.
All Mercury Inns pubs are currently being run by Mercury’s pub management arm while it seeks to raise finance to buy back the three leaseholds and four freeholds from administrators BDO Stoy Hayward.
The leases could be bought back as early as today but the purchase of the freeholds depends on the raising of finance, which Butler admitted in this market was “tricky”.
Butler added: “The pubs are still trading and we are pushing ahead with the financial restructuring, which will see us dropping some debt.”
Mercury also owns another pub freehold in a different company, which is unaffected.
Its pub management arm, Mercury Management, and its distress recovery arm, Mercury Liquid, which has been contracted by Enterprise Inns at a number of pubs, are also unaffected by Mercury Inns going into administration.
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