City Diary — 5 March

Kiely: 'I ended up putting more in than I was taking out'

Here's priceless. Paul Kiely, the founder of discredited pub company Provence, which specialised in selling over-priced pubs to gullible investors at auctions, is now managing director of a business turnaround company called Kuis. He's offering the benefit of his experience running Provence, which crashed at the end of October 2006.

On the Kuis website, he recalls how it all went horribly wrong: "It was a lovely September evening. The Champagne was flowing at the Savoy. The 'big wigs' from the bank, investors, private bankers, sports personalities and all my staff were there. My company was the host and the atmosphere was great! I had arrived on 'success street' — a dream come true! Four weeks later this dream had turned into a nightmare: the bank had pulled the plug, my personal accounts frozen.

"My personal guarantees were being called in — even prior to the sale of our assets! The assets were sold off by the receivers (aka the 'vultures') for a fraction of their value. I ended up with nothing. I could not come to terms with how fast all this happened. From £35m to zero — in no time flat." Kiely lists the lessons he learnt and warning signs, including this one: "I was starting to put more money in than I was taking out."

Is City Diary the only one getting emotional?

Progress made in Spirit world​

City Diary was wondering how the transfer of 50 pubs from the Spirit managed division to Punch's tenanted section was going. The transfer was, after all, unveiled last July and there's been little news since. A Punch spokesman says: "There is not too much to say on the programme other than it is going well. There was a lull over the Christmas period but things have picked up since then and interest is good. Eleven transfers have taken place already and 12 are almost at completion stage." Almost halfway there then.

Dirty weekends hit waistlines​

Out-of-town pubs are a major beneficiary of those having, er, affairs. The average extramarital affair costs £8,000 with trips to tucked-away pubs accounting for £916 of that, according to OnePoll.com, who tell us: "Folk are cheating themselves getting into debt for a bit on the side." At least they're eating well.

Is all fair in love and covenants?​

Enterprise Inns is selling pubs with restrictive covenants that prevent them reopening as pubs. You can see it makes sense in a village that might have two Enterprise Inns pubs. Elsewhere, though, it doesn't seem fair to anyone. How do shareholders know that Enterprise has obtained the best price for a site if pub-buyers are ruled out of the hunt? In the middle of a city like Lincoln, say, there can be no guarantee the move will benefit other Enterprise licensees. Enterprise's Turk's Head in Lincoln's Newport is on the market for £295,000 with a covenant stopping its use as a pub. The pub's had six designated premises supervisiors in 11 months but who knows if there's a buyer out there who can make a better fist of it than Enterprise?

Hasta la pasty for Worthing pub​

What's happening to closed-down pubs, part 48. More Cornish cultural colonialism in Worthing.

The Real Cornish Pasty Company is taking over the Ship, one of Worthing's most famous buildings, where the facade resembles the stern of an 18th-century galleon.

Not quite so grim in Grimsby​

It looked like it was all over for Grimsby's Riverhead complex. The complex looked down and out last year. Yates's, Walkabout, Chicago Rock Cafe and an independent bar called Musika all called last orders in recent times, leaving JD Wetherspoon's Lloyds No 1 as the sole survivor. But there's Darwinian evolution going on. The Chicago Rock Cafe reopens next month as Shooters while former Musika venue becomes LA's Retro. Yates's, which closed in the Laurel cull last March, has already reopened as a buffet restaurant called Mr Jones. Walkabout closed at the start of August 2008 but was reopened by an independent at the start of 2009. Steve Brighty, area manager for Lloyds, has views on why there were so many closures: "The reason why several places on the Riverhead closed was because they weren't managed very well."

Taybarns does turn a profit​

City analyst Nigel Parsons, of Evolution Securities, has visited a Whitbread Taybarns site. Some of the customers looked like they were "eating for days" to beat the credit crunch, he told chief executive Alan Parker, below. Parsons then popped the

$64,000 question — is the brand actually making money on turnover around the £60,000 per week mark? "They do make money for us," Parker told him.

Pubco's multiple personality​

Credit where credit is due. Turns out that Enterprise Inns has had a man in place for two years whose job it is to oversee its relationship with multiple tenants. His name is Brian Sorrell and his appointment is a recognition of the value to be gained by working more closely with multiple tenants, who can normally be relied upon to out-perform. Hurrah!

Luminar pushes on with vodka​

Nightclub behemoth Luminar is choking back the capex. But innovation continues. It opened two vodka bars within its Oceana complex in Milton Keynes and Watford. But chief executive Steve Thomas admits it's pretty sticky out there. "It's the worst I've known since 1974," he tells City Diary.

Half-term carve-up​

News from the carvery front over half term

was good. A Mitchells & Butlers Crown Carveries site in Plymouth's Plympton area (knocking them out at an affordable £3.43 per carvery), the Lord Louis, served a new brand record of 1,045 meals in a single day. Meanwhile, the Ash Bank Hotel, in Werrington, Stoke-on-Trent, achieved a new brand record of 6,053 meals in a single week (that's £20,580 on food alone). Crown Carveries now has Whitbread's Taybarns offer (7,000 meals a week) within its sights.

All aboard the origin express ​

Interesting that even a mainstream lager brand like Carling is now firmly aboard the provenance bandwagon. Current adverts, like the one above that appeared

in the Sun last week, puts its stress on ingredients rather than beery blokes licking lager off the floor or rampaging through the streets playing football. A Coors public relations type tells City Diary: "It's going to be a long-term element of Carling advertising."