Marstons currently a pub company with a minority stake in Carlsberg Brewing UK (which now brews the beer) has received a takeover bid from a US private equity company Platinum for its pub estate.
The Guardian report is here:
With share prices of UK listed hospitality companies hit by the pandemic they can be an attractive proposition for those with spare money. The Financial Times notes that Platinum is one of a number of US private equity concerns that has ‘dry powder’ that is money they have raised to invest in companies when its attractive to do so.
In that context the bid which is current for a month under UK rules look more like an investment than asset stripping but no doubt if it goes ahead we shall see.
Greene King was acquired by a Hong Kong investment company and the current bid suggests that we may be moving beyond the world where beer companies consolidated and became larger near monopolies in certain areas, to a situation where pubs and beer are seen as a useful thing to have on the balance sheet of concerns that have no particular interest in pubs or beer
Its unlikely to be great news for pubs, beer and jobs though. What price Government regulation to protect the sector one wonders?
Update
The Marstons board has unanimously rejected the Private Equity bid (higher than two made before Xmas) on the grounds that it undervalues the company. That still raises concerns.Firstly that they might accept an increased offer and secondly that a hostile bid might continue anyway- the deadline for that is 26th February. This may just be the first round…
Update 2
In a rare if modest bit of good news for the UK pub sector, the deadline for the private equity bid has now passed and the bidder has walked away. As the analysts comments below (analysts are essentially people who write about listed companies & provide the ‘sentiment’ on how well or not they are doing & hence guide share prices) indicate Marstons sees a future for itself as an independent-ish entity:
Marston’s rejected a £690m offer from the US group last month, and that now seems to be that. Platinum said: “After careful consideration, [Platinum] does not intend to submit a revised proposal and it will not make a firm offer for Marston’s.” There is the usual caveat that it could come back if Marston’s agrees or another bidder emerges.
But the Hobgoblin and Pedigree brewer seems determined to go it alone. It said: “The Board continues to believe that Marston’s is well placed to benefit from the opportunities in a post-COVID 19 trading environment, following the completion of the SA Brain transaction [to operate 156 pubs in Wales] and harnessing factors such as a reduction in on-trade industry supply, and increased home-working that will benefit pubs in suburban locations.
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