Punch Pubs, one of the UK’s biggest pub owners, has changed hands again with Fortress, the one-time bidder for supermarket Wm Morrisons, its new owner.
The acquisition price is said to be in the region of £1bn.
Punch has around 1,300 outlets across the UK, 56 of which were acquired this July with the purchase of Young’s Ram Pub Company.
Founded in 1997 by former PizzaExpress head Hugh Osmond and Café Rouge founder Roger Myers, the group rapidly expanded from one outlet in Fleet Street through a series of quick-fire acquisitions.
Osmond sold out in 2003, but the deals continued with brands such as Pubmaster, Innspired Group and Avebury Holding all added, while disposals included the Old Orleans chain in 2006 to Regent Inns and a 50% holding in distributor Matthew Clark in 2015.
European venture capital firm Patron and UK-based May then bought it for roughly £1.8bn in 2017 in a deal with Heineken, with the Dutch brewer acquiring 1,900 of the chain’s pubs for £305mln.
New owner Fortress already has a presence in the UK drinks market through off licence chain Majestic Wines, which it acquired in 2019, with one of the attractions likely to be the large number of freeholds within the estate, said analysts.
More than 90% of its properties are freeholds, making it an attractive target for private equity owners.
The portfolio also largely comprises rural and suburban pubs, which have benefited during the pandemic from people working at home and through often having outdoor space.
Clive Chesser, Punch’s chief executive said, "This is very positive news for everyone connected with Punch, and we are extremely excited about the opportunity that lies ahead with Fortress Investment Group.”
He added that the support of Patron and May “has been invaluable over the last four years, none more so of course than during the pandemic."
Cyril Courbage, Fortress’ managing director said: "We are excited to team with Clive and the Punch management, which has done an exceptional job of navigating the challenges of the Covid crisis while positioning the business for long-term growth and value creation.”
The timing of the deal comes as many pub owners have warned of the impact of the government’s new Plan B clampdown to combat the spread of the Omicron variant.
December can contribute as much as a third of profits to some chains and many have reported a wave of cancellations of Christmas events due both to the measures and concern about catching the new strain.
Courbage, though, said the UK remains an extremely attractive investment environment,” and the purchase will allow Fortress to “continue to explore other opportunities in this sector and across the UK, Ireland and Europe."