According to reports, the private equity firm is considering a bid of around £300m for a package of approximately 300 freehold pubs from Britain’s biggest pub operator.
Join our new WhatsApp channel: The Morning Round-Up
Get the biggest pub trade stories straight to your phone. Listen to our one-minute daily news briefing and receive breaking news, exclusives and sector updates throughout the day. Remember to turn notifications on in the top right corner!
A Stonegate Group spokesperson told The Morning Advertiser (MA): “As we have previously said, we continue to look at options for the Platinum portfolio, which could include a refinancing, partial sale, or full sale of the Platinum sites.
“But as we explained to our bondholders, no decisions have been made. We are continuing to make good progress on our transformation strategy.”
The reports come amid wider scrutiny of Stonegate’s capital structure and estate strategy, as the group continues to reshape parts of its wider estate through conversions into leased, tenanted and operator-led models.
The sites form part of Stonegate’s wider Platinum portfolio, a collection of around 1,000 leased and tenanted pubs which the group confirmed last year it was reviewing.
The latest reported process is understood to cover a smaller group of around 300 sites, many of which are said to be among the group’s best performing pubs.
Stonegate is reportedly working with real estate focused investment bank Eastdil, with a number of private equity firms expected to submit offers ahead of an initial deadline.
Investor appetite
The reported Terra Firma interest points to continued investor appetite for high quality pub assets, despite wider pressure across the sector from labour costs, business rates, energy bills and financing costs.
Stonegate, which is owned by TDR Capital, operates more than 4,000 venues across brands including Slug & Lettuce, Walkabout, Proper Pubs and Craft Union.
The group has been under pressure to reduce its debt burden following its 2019 acquisition of Ei Group, with The Telegraph reporting the business is managing a £3.8bn debt pile.
The latest reported auction is understood to be an initial process to test demand for part of the estate, with Stonegate previously confirming the wider Platinum review could include a refinancing, partial sale or full sale.
Terra Firma, founded by financier Guy Hands, has previously invested in the UK pub market, including Voyager Pub Group, Unique Pub Company and Inn Partnership.
The firm is now run by Hands’ son Richard and finances acquisitions on a deal by deal basis, rather than through a dedicated committed fund.
Terra Firma declined to comment on the reports.
