Greene King trumps Fuller's in £93m Capital Pub Company deal
Greene King has trumped Fuller's by reaching agreement on a £93m deal to buy Capital Pub Company.
Fuller's had originally made an indicative offer of £54m for Capital but the offer was rejected by the London pub firm which said it "seriously undervalued the business". Fuller's had been given until the end of this month to "put up or shut up".
But now Greene King has swooped in with an offer of 235p per share, valuing the issued share capital of Capital Pubs at around £70m and implying an enterprise value of £93m.
The offer price represents a premium of around 51% to the closing price of 155.5 pence for each Capital Pubs sShare on 16 June 2011.
Greene King said the acquisition was "an opportunity to maintain and develop the existing strengths of Capital Pubs as part of Greene King, but also an opportunity to create an even stronger pub retailer within the attractive and growing premium eating and drinking out market in London".
The combined business will operate around 250 pubs within Greater London and will fit with Greene King's recent acquisition, Realpubs, and its existing London pubs.
Commenting on the offer, Rooney Anand, chief executive of Greene King, said: "The proposed acquisition represents another firm step as we continue to expand our presence in London. Capital Pubs would bring a further 34 premium pub assets and take our Greater London estate to approximately 250 at a time when London is outperforming the national pub market.
"This offer represents a fair price for a high quality, largely freehold pub estate. Capital Pubs is a premium London pub company that fully meets our criteria as we continue to progress our retail expansion strategy. Capital Pubs' estate fits well within the Greene King portfolio and we intend to combine it with our recently acquired Realpubs business, thereby generating attractive cost and revenue synergies."
Clive Watson, chief executiveof Capital Pubs, said: "Greene King is an excellent cultural fit with Capital Pubs and will be a good home both for the business and for our staff. Greene King is renowned for nurturing the businesses it acquires and I have every confidence that Capital Pubs will continue to develop under its ownership. We have recommended Greene King's deal to shareholders as we believe it reflects both our high quality business and its prospects."
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By Neil Gerrard
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