Greene King buys restaurant firm Cloverleaf for £56m
Greene King has bought Cloverleaf Restaurants for £56m.
Cloverleaf operates large, freehold pub restaurants in the North of England and Midlands. Greene King said the acquisition of the chain, which is performing strongly in the growing carvery market, would help accelerate its "repositioning toward food-driven retail outlets".
Greene King will have 12 Cloverleaf sites by the end of the financial year, which means the deal is equivalent to 8.7x annualised outlet earnings before interest, tax, depreciation and amortisation (EBITDA). It added that Cloverleaf has a "strong pipeline" of additional sites, with another 10 planned for the next two years. The additional 10 sites are expected to require £25m worth of investment.
Meanwhile Greene King reported in its interim management statement for the 38 weeks to 23 January 2011 that it had seen its continued shift towards food like-for-like sales in its retail division. Like-for-like sales were up 3.9% overall, with budget brand Hungry Horse climbing 10.3% and Scottish business Belhaven up 3.6%. Overall food sales growth in the retail division stood at 8.2%.
The company added that it expected margins for the full year in Greene King Retail to be "slightly ahead" of the previous year.
In its tenanted division, like-for-like EBITDA per pub was up 0.6% and average EBITDA per pub climbed +1.9%.
Greene King reported that trading in the last eight weeks was hit by the December snow, but that January had seen a positive impact thanks to improved conditions.
The brewing company's own-brewed volume fell 3.3% against a UK ale market down by 7.6%.
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By Neil Gerrard
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