Punch Taverns sells 158 'non-core' pubs to NewRiver Retail
Pub group Punch Taverns has reached an agreement to sell 158 pubs for £53.5 million to NewRiver Retail.
In a statement, Punch said the sale was part of its strategy to sell its non-core estate at a rate of approximately 200 pubs per year.
The agreement is unconditional and is expected to complete on 11 September. The proceeds will be used to reduce net debt.
The pubs being disposed of have generated earnings before interest and tax of £7.3 million over the last twelve months.
Duncan Garrood, chief executive of Punch Taverns, said: "This transaction is in line with our stated strategy of disposing pubs within the non-core estate, reducing the overall level of our debt, whilst focusing on our higher quality core pub estate."
NewRiver Retail said it has identified a number of development opportunities within the portfolio, which could include residential new builds on surplus land, extension or part-conversion of pub assets for residential use and the build of new convenience stores on surplus land.
Allan Lockhart, property director at NewRiver Retail, added: "We are delighted to announce the acquisition of the pub portfolio from Punch Taverns, which represents a strategic progression for NewRiver, following our acquisition of a similar portfolio from Marston's in late 2013, the successful result of which has led us to identify similar opportunities.
“In many ways this portfolio is similar to our Marston's transaction, in that we expect to deliver exceptional cash on cash returns and attractive capital growth through asset management and development. We are confident that this acquisition will add significant long term value for our shareholders."
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