CMA greenlights revised Heineken deal to buy Punch pubs

By Georgina Townshend contact

- Last updated on GMT

Carefully assessed: Heineken's proposals to address CMA concerns have been accepted
Carefully assessed: Heineken's proposals to address CMA concerns have been accepted
The Competition & Markets Authority (CMA) has accepted proposals from Heineken to address concerns that its purchase of 1,900 Punch Taverns would undermine competition in certain areas.

On 27 June Heineken confirmed it would sell a number of pubs​ across Britain after the CMA said its proposed multi-million-pound acquisition of the Punch pubs "had the potential to reduce competition" in 33 areas across the UK.

The CMA was concerned that reduced competition “could lead to price increases or a deterioration in the quality of the serve on offer”. 

Proposals to address concerns

Before the merger was referred for a further in-depth investigation, the companies were given the opportunity to offer proposals to address these concerns.

Heineken responded by saying it would sell 30 pubs in areas highlighted by the CMA. Half of the pubs due to be sold are Star Pubs & Bars sites, with the other half being Punch pubs.

Affected premises include​ five in the north-east, eight in Scotland and one in Guildford, Surrey.

Carefully assessed

Before reaching a final decision, the CMA said it had “carefully assessed and consulted” publicly on these proposals.

A CMA spokesman said: “The CMA is satisfied that its concerns have been addressed and has, therefore, decided that the merger will not be referred for an in-depth phase-two investigation.”

In response, a spokesman for Heineken said: “We welcome today's announcement from the CMA that, following consultation, our proposed undertakings have been accepted and there are no outstanding concerns.

“We, therefore, expect to complete our acquisition as planned by the end of August."

Punch has said it is targeting Tuesday 29 August as the date by which it will complete the acquisition.

While the deal in total is worth £403m, Heineken itself is paying c£300m for the 1,900 Punch pubs plus taking on £960m worth of debt - in effect paying £1.26bn for the whole deal.

*This article was updated on 21 August to reflect that Heineken is paying around £300m for the Punch pubs and that the entire deal, which covers more than 3,000 premises, is worth £403m in total.

Related topics: Punch Taverns

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