Pubs at risk amid owner’s £2.6bn debt
Dozens of Stonegate pubs across Scotland are potentially at risk of closure, a union has warned, as the chain’s parent company bids to refinance £2.6 billion of debt.
Forty-four pubs north of the border were on a Uk-wide list distributed by GMB, as private equity firm TDR Capital claimed it was “well placed” to deliver on long-term objectives despite the refinancing move.
Prominent pubs in Edinburgh on the list include the Slug & Lettuce at George Street and the Omni, as well as Finnegan’s Wake, The Chanter, Amber Rose, Hanover Tap and The Southsider.
Stonegate is one of the largest pub companies in the UK, and also owns Glasgow’s The Merchant and Aberdeen’s Slaine’s Castle and Triplekirks.
More than 19,000 staff are employed across Stonegate pubs in the UK.
GMB has claimed TDR Capital’s finances “lack transparency”, with the ultimate holding company based in the Cayman Islands.
Gary Lindsay, boss of TDR Capital, which also owns supermarket giant Asda, said on Tuesday he was “confident” £2.6bn in debt in the Stonegate Pub Company could be refinanced this year.
But GMB Union is concerned that refinancing could lead to crippling payments to service the debt.
GMB regional secretary Justin Bowden said: “The position with the Stonegate Pub Company’s finances is lacking in transparency, with the ultimate holding company based in the Cayman Islands.
“TDR Capital must be accountable to local people and they have a duty to safeguard 4,500 pubs, which are vital community assets. GMB’S experience with private equity owners has been, and continues to be, wholly negative.
“We fear for the future of our local supermarkets and pubs in the hands of their private equity owners.”
Mr Bowden added: “They boast that they are hard on shareholders, but they keep well away from the results of their hands-on initiatives.
“They have refused to explain to GMB gaps in the company’s accounts, saying that the 18 companies in their opaque structure are not GMB business.
“Quite simply, this is not good enough and not acceptable … GMB’S experience with private equity owners has been, and continues to be, wholly negative.
“We fear for the future of our local supermarkets and pubs in the hands of their private equity owners.
“We are far from reassured that our members and our communities will not be ripped off as the CMA found happened with the Asda petrol stations.”
A spokesman for Stonegate said: “We continue to invest in our pubs and our people, in particular supporting local pubs which play such a key role in their communities.
"Our pub business remains very resilient despite the challenges our industry faces, with good like-for-like sales growth across the group.
"Following our recent successful financing announced in December as well as strong recent trading, we are well placed to deliver on our longer term objectives and we are very confident in our ability to re-finance at the appropriate time.”
The position with the Stonegate Pub Company’s finances is lacking in transparency