Punch in preliminary takeover talks with Spirit Group |
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Published
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Mon, 27 Jun 2005 09:35
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It is being reported that the country's second-biggest pubs group, Punch Taverns are looking to snap up rivals Spirit Group in a deal that is believed to be worth almost 3 billion pounds.
The Financial Times has reported that Punch has made an unsolicited approach for Spirit earlier this month, but any on-going talks were at a strictly preliminary stage. But it is being speculated that Punch could confirm the approach in a statement to the stock exchange tomorrow.
If the deal does go through, then Punch which operates around 7,800 pubs could edge past Enterprise Inns, which has some 8,644 sites and emerge as the country's largest pub chain.
It is also being reported that Punch could convert Spirit's 1,200 pubs into tenanted ones and sell the remainder of the pubs to another competitor like Mitchells & Butlers. Spririt operates around 2,000 pubs.
Private equity firms Texas Pacific, Blackstone and CVC Capital as well as investment bank Merrill Lynch are the co-owners of Spirit. Spirit has apparently asked is adviser, Merrill Lynch, to explore the Punch offer.
At the moment, Spirit is also considering a trade sale, a sale to another private equity firm or floating an IPO. Last year, Spirit sold its Premier Lodge chain of budget hotels to leisure group Whitbread for £536 million.
Staffordshire-based Punch has been on an acquisition spree recently. It acquired 471 pubs through its takeover of pubs group Innspired for £335 million in 2003.
Punch and Spirit were not available for comment.
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