Admiral Taverns in debt-for-equity swap

Admiral Taverns has undergone a debt for equity swap which sees Lloyds Banking Group, the pubco's lender, now owning a significant stake in the business.

The anticipated deal, steered through by administrators at PricewaterhouseCoopers, marks an end to the involvement in the pub game of the Rosenberg and Landesberg families, who established Admiral in 2003 by buying tail end pubs from large operators including Enterprise Inns, Punch Taverns and Greene King.

While Lloyds is understood to have written down up to £600m on its investment in Admiral, its holding in the pubco is believed to be less than 50 per cent, largely to avoid having to bring its accounts into the bank's. Lloyds declined to comment on its stake, but said it had already accounted for any writedown which would occur.

A spokesman would not say how the long Lloyds - which is effectively publicly owned after the recent government bail out of the banking sector - would hang onto its holding in Admiral.

Meanwhile the pubco's executive management, including chief operating officer Lynne D'Arcy, also have a stake, although the scale of this holding has not been declared.

Admiral's demise was the result of crippling interest payments on its near £1bn debt.

Sources suggested that following the "dramatic" reduction in both debt and interest liabilities the new group could and would trade profitably.

The companies that have gone into the pre-pack administration included the group leading entities, Admiral Taverns Group Limited and Admiral Taverns Holdings Limited, as well as two other holding companies.

It was being stressed by sources close to the deal that the pre-pack would not result in either job losses or suppliers going unpaid.

The move would make "no difference" to Admiral Taverns' tenants, who would continue to trade and pay rent and beer bills in the normal way.

In a statement Admiral said: "This move marks an end to recent speculation about Admiral Taverns' future and places the group on a firm financial footing.

"There will be no impact on the day-to-day operations of the Group, business will continue as usual and the current management team will remain in position.

"Our main concern throughout these negotiations has been to minimise disruption to our staff, partners and suppliers and we are happy to say we have achieved this.

"Landlords, tenants, suppliers and contractors should also be unaffected and will continue to do business with us as they have previously."