Young's to buy City Pub Group in £162m deal
Young & Co’s Brewery said on Thursday that it has agreed to buy City Pub Group for around £162m.
Under the terms of the deal, City Pub shareholders will receive 108.75p a share in cash and 0.032658 Young’s shares.
Young’s chief executive Simon Dodd said: "City Pubs is an excellent business we have followed for some time, and one which aligns closely with Young's in terms of both strategy and culture. Like us, City Pubs operates premium, individual and well-invested pubs and rooms, with a focus on the highest standards of customer service. Both businesses have performed well in a tough trading environment recently, testament to the strength of our business models, people and approach to customers.
"We believe that City Pubs is an excellent fit with Young's and the combination of the two businesses represents a compelling opportunity for all stakeholders. It will allow us to expand our estate through the addition of a complementary, high-quality pub and bedroom portfolio, with the potential for the benefit of significant operational synergies to be realised by both sets of shareholders, through the partial share offer."
News of the acquisition came alongside Young’s interim results, which revealed a record performance.
In the 26 weeks to 2 October, adjusted pre-tax profit rose 12% to £28m on revenue of £196.5m, up 5.4% on the same period a year earlier.
Young’s said the period was a "tale of two halves", as sunny weather in June gave way to unfavourable weather in the core summer months of July and August.
Most recently, the pub chain said it was boosted by the hot weather in September and the start of the Rugby World Cup.
Young’s lifted its dividend by 6% to 10.88p a share.