Town & City Pub Company restructures
Commerzbank has acquired an equity stake in Town & City Pub Company, the bar and pub business that emerged from Laurel, from Kaupthing, the state-controlled Icelandic bank.
Under the terms of the deal, Kaupthing is still the largest shareholder in the group, but its holding has been reduced down to 49%. It is thought that Commerzbank — the main debt provider to the business — has assumed about 30% of the equity.
The terms of the deal, which was agreed at the same time of the restructuring of sister company Bay Restaurant Group (Bay Restaurant in debt for equity swap), which was also formed out of Laurel, remain unclear although it is understood that Town & City's debt position remains unchanged.
The management team, led by chairman Ian Payne and chief executive Toby Smith, is thought to hold the balance of about 20%. Payne said that the company had extended its debt facility until 2012, with no change to the level of its debt, and that it now had an appropriate level of funding in place.
He said that the company was investing £7m in its estate overall, with plans to open more larger sized Yates's Wine Lodges. Refurbished sites will open under the Yates's brand in
Southampton and Sheffield at the end of September, following the recent launch of an outlet in Swansea.
In the second half of the year, Payne said that the group would go back to focusing on opening smaller Yates's and on debranding its Litten Tree and Hog's Head sites. Kaupthing become the majority shareholder in both Bay and Town & City after the two businesses emerged from a pre-pack administration of Laurel, which was owned by Robert Tchenguiz.
Commerzbank become the key debt provider to both businesses after it bought rival Dresdner in January.
