Marston's sells 137 pubs to rival
Wolverhampton-based pub group Marston's has sold 137 pubs to rival Admiral Taverns for £44.9 million as bosses attempt to pay down the business's debts.
The deal is the second major pub purchase by Admiral is just a few weeks and is part of its new boss's plans to expand the business.
Marston's, which has pubs across the West Midlands, said it could not provide details on which ones have been sold for "confidentiality reasons".
Marston's chief executive Ralph Findlay said: "We are making good progress with our plans to reduce our net debt by £200 million by 2023, in part through the disposal of non-core assets.
"We are encouraged by the level of market interest that this portfolio of pubs has attracted. This further underpins our confidence in achieving the accelerated £70 million disposal proceeds target that we have set ourselves for the current year."
He added that the pubs being sold are primarily smaller tenanted and franchise sites which are drinks- or "wet-led", generating £4.8 million of underlying pre-tax profits.
But Marston's insisted the deal will help average profit per pub increase by around seven per cent as it pushes towards a more premium offer.
Admiral said the deal is part of its strategy to integrate and develop "sustainable tenanted pub businesses", coming just weeks after snapping up 150 pubs from the Heineken-owned Star Pubs & Bars business.
Chief executive Chris Jowsey, who joined from Star Pubs in the summer, said: "We remain fully committed to the leased and tenanted model and through this acquisition have been able to acquire an excellent portfolio of pubs which we look forward to developing through our award-winning and highly supportive approach."
He was backed by Admiral investors Proprium Capital Partners and C&C Group, and has seen the business form a partnership with experienced managed-operator Helen Standing, to help with the integration.
