JDW to buy 12 pubs from 3DE for £4.3m

JD Wetherspoon is expected to shortly confirm the acquisition of 12 late-night venues from 3D Entertainment (3DE) for an estimated £4.3m.

JD Wetherspoon is expected to shortly confirm the acquisition of 12 late-night venues from 3D Entertainment (3DE) for an estimated £4.3m.

It is understood that the pub group will exchange contracts on the sites, which include a mixture of Chicago Rock Café outlets and nightclubs, next week.

The £4.3m figure it is paying equates to a multiple of three times earnings.

JDW recently unveiled plans to open 250 new pubs over the next five years.

The remaining 3DE business is set to be bought by one of three bidders — R Capital, Matterhorn Capital and Brook Leisure.

Novus Leisure and Sun Capital are also thought to have looked at the business.

As previously revealed by M&C Report at the end of December, the sale of 3DE's assets is set to trigger a financial restructuring, which it is thought could involve the group being wound up via a company voluntary agreement.

3DE is 49% owned by Luminar, Britain's biggest nightclub business, which has a £10m loan note against the company, the value of which was recently written down from about £20m. The management team owns about 30% and Prestbury, the property firm, has about 20%.

Prestbury owns the freeholds of between 20 and 30 venues operated by 3DE. Sources indicate that it is willing to re-base the rents at these venues, trimming the annual rent by about £1m.

In a recent announcement to shareholders, Luminar said that it was actively pursuing the sale of its investment in 3DE, but that the sale outcome was now expected to be significantly below the carrying value of £17.3m included in the group's balance sheet at 27 August 2009.