Propel Newsletter Archive Page

Abolition of personal licences misses deadline: The deadline for the abolition of personal licences appears to have been missed. Solicitor John Gaunt said: “We have previously reported on the suggestion that personal licence renewals in England and Wales may still be required after all in 2015, as proposals to remove the requirement to renew are stalled in Parliament. This has now apparently been confirmed.” In a letter written to all local authorities, the Minister for Crime Prevention, Norman Baker, stated: “There are a number of alcohol licensing provisions progressing through Parliament as part of the Deregulation Bill. One such measure is the removal of the need to renew a personal licence. The timescale for the Bill means that there may be some who will need to renew their licence before the changes take effect. This is beyond my control, although I do recognise that it is far from ideal. My officials will work with you to establish the best way of handling transitional arrangements and we will publish specific guidance later this year.” The letter also encourages the use of Late Night Levies and seeks feedback on the experiences of trying, but failing, to introduce Early Morning Alcohol Restriction Orders. In the letter, Baker also congratulated local authorities which have adopted a Late Night Levy – and reminds authorities that the revenue split is flexible. He states: “I would like to congratulate those of you who have adopted the Late Night levy and I hope to hear from you about the benefits that this is bringing your area. The levy enables a contribution to be raised from businesses benefitting from late-night alcohol sales to support police and local authority costs. While the legislation stipulates that the police must receive at least 70% of the income generated, I want to make it clear that there is no bar at all to making a local agreement between the licensing authority and the Police and Crime Commissioner to vary this percentage split by allocating some of the PCC’s share of the revenue back to local authority initiatives.”

Industry News:

Camra calls for new law to protect pub as closure rate accelerates: New laws should be introduced to make it harder for pubs in England and Wales to be demolished or converted into shops, the Campaign for Real Ale (Camra) has argued. The organisation has reported that 31 UK pubs have closed every week this year – a rise of five a week on 2013. The group said it was “perverse” that pubs could be demolished or converted without council planning permission and has called for a change in the law. The government said councils already had powers available to protect pubs. Tom Stainer, head of communications at Camra, said: “Popular and profitable pubs are being left vulnerable by gaps in English planning legislation as pubs are increasingly being targeted by those wishing to take advantage of the absence of proper planning control. It is utterly perverse that developers are able to demolish or convert a pub into a convenience store or many other uses without any requirement to apply for planning permission. It is wrong that communities are left powerless when a popular local pub is threatened with demolition or conversion into a Tesco store.” Camra says there are currently 54,490 pubs in the UK.

New York tourism boss praises London: New York’s new tourism boss has praised Heathrow Airport and said that London does a better job of welcoming visitors than the Big Apple. Fred Dixon said that delays at JFK airport, which regularly run to three hours, are a “detriment” to the image of the city – and America as a whole. In an interview with The Evening Standard he also said that London had the best taxi drivers in the world and that they were one of his favourite things about the city. Dixon said: “London is in the best shape I think it’s ever been in. It’s clean, it’s safe, and very welcoming. I’ve never waited in line more than 30 minutes at Heathrow, even with the volume they do. The sense of arrival is something that we as Americans can learn from and strive for.” While London is the most popular city destination in the world with 18.6 million visitors, New York languishes in sixth with 11.8 million, according to figures from Mastercard.

Foodpanda takeaway delivery firm raises another $60m: Foodpanda, the online take-away food delivery company active in dozens of emerging markets, has raised $60 million in new financing from a group of investors including existing backer Rocket Internet AG. Foodpanda, one of a stable of ecommerce and financial services ventures created by Berlin-based Rocket Internet, is in a global race to stake out the highly local food take-away market, an online segment that has featured two high-profile share listings this year and big investments by US and European venture firms. The latest financing marks the third sizeable round of investment for Foodpanda, which has raised a little over $100 million since it was founded in 2012, said Ralf Wenzel, co-founder and chief executive. Added funding will help Foodpanda deepen penetration of its existing Asian, African, Eastern European, Middle Eastern and Latin American markets before a variety of publicly traded or otherwise well-financed rivals can enter them, the company said.

Company News:

San Carlo Group to open Covent Garden site: San Carlo Group is to open San Carlo Cicchetti in Covent Garden following the success of Cicchetti, Manchester and London Piccadilly. The site will open in Wellington Street in September. The restaurant will specialise in offering small plates of regionally sourced seasonal Italian cuisine. Owner Carlo Distefano said: “For more than 2,000 years the Italian people have understood how to use the best that nature has to offer and to transform even the simplest of ingredients into small delicacies. This is what I am passionate about conveying throughout my restaurants and the new Covent Garden venture will be no exception.” Celebrity chef Aldo Zilli will be collaborating with Cicchetti on the restaurant’s menu. He said: “I am extremely excited to be part of this new venture with the San Carlo Group as they always bring the best to the table. (They are) giving me carte blanche on new menu creation and developing new dishes with the best that Italy has to offer in season.”

Mixed response to Wetherspoon return to Muswell Hill: There has been a mixed response to a plan by JD Wetherspoon to open a pub again in Muswell Hill, the area of north London where Tim Martin founded the company. It wants to re-open the site of what was The Village in Muswell Hill Broadway, which closed last year. People living nearby have raised concerns about increased noise and parking problems in the area. Those living in the nearby Summerland Grange flats, adjacent to the site, have expressed concerns over drinkers in the proposed rear terrace and beer garden being able to look directly into their properties. Wetherspoon paid £3m for the freehold of the Village in Muswell Hill last year, with a further £1.5m spend planned to re-open the venue. James Grimes, of agent AG&G, said at the time of the acquisition in December 2013: “With a total site area of 907 square metres, an existing 470 square metre unit and planning permission to remove the roof from an old tram shed on much of the remaining area, Wetherspoon could either create one of the best beer gardens in London or double the size of the current pub. The potential of the site is huge.” Of his old Muswell Hill stomping ground, Tim Martin said last year: “It was the launch pad for Wetherspoon’s success across the UK. I’m looking forward to seeing a Wetherspoon pub in Muswell Hill again.”

Greene King to appeal tax avoidance ruling: Greene King is to take its long-running fight to prove the legality of a tax reduction scheme, Project Sussex, to the court of appeal despite two defeats in the lower tax courts, The Guardian has reported. The annual report from the company, published last week, reveals plans to resume the legal battle, though the accounts show the firm has now made a financial provision to cover a potential defeat. “We have been advised that the upper tribunal [tax court] decision was unclear on certain elements of the case and, therefore, it will now be considered by the court of appeal,” said Greene King, which holds its annual shareholder meeting at Newmarket racecourse on 10 September. The Guardian has also reported that Greene King chief executive Rooney Anand has refused to speak to it since the newspaper raised questions about Project Sussex 16 months ago. A spokesman said he felt the questions had not been appropriate.

McDonald’s reports worst monthly sales in a decade: McDonald’s has reported July sales results that were much worse than analysts had expected, with Europe the bright spot with sales up 0.5%. The results prompted Janney Capital Markets to lower its estimates for the company. Its analysts said the results “were the worst world-wide month in the last ten years, once trading-day adjustments are taken into account.” The company has 35,600 restaurants internationally and with 19% owned by McDonald’s, the company plans to franchise a further 1,500 of its company-owned stores, mainly outside the US, by 2016. In the Asia/Pacific, Middle East, and Africa regions, sales were down 7.3% in the month, where a drop of just 0.5% had been expected. Like-for-like sales in the US sank 3.2%, weaker than the 2.6% expected. RBC Capital Markets analysts blamed the poor US sales on a lack of new menu items. “We believe McDonald’s US is focusing hard on operations as a way to bolster growth during peak hours and set the table for future innovation. That said, sales are suffering in the interim with the lack of significant new product news and unsuccessful promotional activity,” analysts wrote in a note.

BrewDog to open fourth London site this Friday: Scottish brewer and retailer BrewDog will open its fourth London bar – and first south of the river – in Clapham this Friday (15 August). The new bar is located at 11-13 Battersea Rise. In the company blog, BrewDog told its customers: “Taking our new, evolved aesthetic and rocking a new design for the actual bar itself (without giving too much away), this bar will offer up all the usual beery goodness from BrewDog and renowned craft beer breweries from around planet Earth. We’ve also scoured the country’s finest producers for some delicious cheeses and meats for some epic charcuterie action, which is the ideal grub to pair with your brews.”

Brasserie Blanc celebrates 18th birthday of first site in Oxford: Brasserie Blanc celebrated the 18th birthday of its very first restaurant, located in Oxford, last week. Guests at the party, which included Raymond Blanc and long-standing regulars, were served dishes from the brasserie’s à la carte summer menu, alongside specials created by the team to celebrate the milestone. Traditional French dishes, including hot smoked salmon, Burgundian snails and spiced breast of Barbary duck, were finished off with a birthday cake supplied by Raymond’s two Michelin starred restaurant, Le Manoir aux Quat’Saisons. General manager Hanna Lucus said: “I am so proud that we have reached our 18th year. Oxford was the first Brasserie Blanc to open, and it has been a leading example in the success of our other restaurants.” Brasserie Blanc now operates 20 restaurants.

Lakeside hotel on the market after Marston’s brewery loan default: An historic lakeside hotel has been put up for sale after being placed into receivership. Offers are currently being invited for Hotel Rudyard in Lake Road, Rudyard in Staffordshire. Corporate restructuring specialist Begbies Traynor said the sale followed a default by owner Ronald William Lloyd on the terms of his mortgage with Marston’s Brewery. Partners at Begbies Traynor, Steven Williams and David Acland, who have been appointed as joint receivers, said weddings and other bookings would be honoured. Begbies has brought in hospitality management company Convivial Management Services Limited to assist with running the venue. All 26 members of staff have been retained since the hotel went into receivership on 17 July. Williams said: “While it is very early stages, we are optimistic that the hotel is a viable entity, that we will be in a position to honour all existing and future bookings, and that we will be successful in securing a going concern sale.” A spokesman for Marston’s said: “Begbies Traynor Group is now managing this site on our behalf. Hotel Rudyard will remain open and trading, meaning all functions will be honoured.” Hotel Rudyard opened in 1851 after the North Staffordshire Railway developed Rudyard Lake as a tourist resort.

Jones Bar Group opens LAB bar and restaurant at Leeds Arena: Jones Bar Group, the Yorkshire operator whose other six Leeds city bars turnover a combined £5.5m per annum, has opened a new restaurant at Leeds Arena Bar called LAB, across from the First Direct Arena, creating 15 new jobs. The £400,000 two-floor bar restaurant venue will make use of pre and post-gig trade and has a 60 cover restaurant on the first floor. As part of a 20 year lease with Town Centre Securities, the new 210-capacity Leeds Arena Bar will offer an experimental cocktail bar and restaurant, with a menu based on quality chicken and burgers to appeal to a wide range of customers. Matthew Jones said: “This is the first bar we’ve opened this side of town, and it’s clear to see the area is bustling. With sell-out gigs attracting more than 13,000 people to the Arena, securing a place on the doorstep is a huge coup for us. People want somewhere to go for a quality bite to eat before a gig, or to continue the night after, and we’re ideally placed to make the most of that trade. We’re not solely dependent on the Arena audience though. The area’s seen much growth and development since 2013, and with a strong line-up of new leisure establishments opening on Merrion Way, we’re confident that we can attract new customers with our offer. LAB is in the ideal location.”

Pret A Manger to expand into mainland China with Shanghai opening: Pret A Manger is set to expand into mainland China, with the opening of an outlet in Shanghai later this year. The sandwich shop chain, founded in London in the 1980s, has grown internationally with a number of outlets in US cities such as New York, Chicago and Washington, as well as in Paris. More than a decade on from the opening of its first stores in Hong Kong, Pret’s private equity owner Bridgepoint – which acquired the chain in a £345m deal in 2008 – the brand is targeting the Chinese market. In an interview with the Financial Times, Bridgepoint’s managing partner and Pret’s chairman William Jackson, said the brand has “refilled its pipeline of projects”. Jackson said: “The US is maturing, France is emerging, the UK is a thriving hub of innovation and we’ve got research and development going in China. We’re planting the seeds for future growth. Getting the provenance of our products right is critical. We’ve made great progress, but we’re under no illusion this will be an easy thing.”

Starbucks denies (again) that it donates to Israel and its army: Starbucks has been forced once again to deny rumors that the company and/or its chief executive financially support Israel and its army. “This is absolutely untrue,” the company said in a statement in response to the claim that the coffee chain and chief executive Howard Schultz donate millions of dollars to support the Israel Defence Forces. “Rumours that Starbucks or Howard provides financial support to the Israeli government and/or the Israeli Army are unequivocally false,” the statement said. “Starbucks is a publicly held company and as such, is required to disclose any corporate giving each year through a proxy statement.”

Tesco opens most-advanced Irish store – with a Costa Coffee, barbershop and community centre: Tesco has opened its most up-to-date Irish supermarket in the town on Dundalk. It has a Costa Coffee located inside the store and a barbershop, Chapz Barbers. One of the other innovations is that the bakery, deli and butcher’s counter have been taken away from their traditional spots at the back walls and relocated to the middle of the store where they are free standing. Tesco spokesman Michael Sullivan said: “This is really a 21st century store and the majority of the initiatives you can see, but there are some that are not as visible. For instances, if you look at the chilled area, you will see white tubes going up to the ceiling. The cold air falls to the ground, but the pipes are catching it and bringing the colder air around to other areas of the store that need to be cooled like the computer room or offices.” In addition, the artificial lighting in the store can automatically dim when it is sunny outside. All these measures are designed, collectively, to reduce the carbon print of the shop and to save on energy costs. Added Sullivan: “Dundalk has the first purpose-built community centre in any of our stores in Ireland. We have converted spaces in other stores, but this is the first purpose-built one and we are offering it to community-based groups in Dundalk to use for free for meetings or fitness classes or whatever they like.”

Former London hedge fund manager plans Mexican push into Asia: Former London hedge fund manager Steven Marks is planning to expand his Australian-based Mexican food brand into eight Asian countries in the next 12 to 18 months. The brand, Guzman Y Gomez, is backed by private equity investor Simon Moore and three pioneers of McDonald’s in Australia. Guzman Y Gomez has 44 outlets across Australia and also wants to build to more than 70 during the next year. Marks worked as a hedge fund manager in London and New York before moving to Australia in 2005 and establishing the Guzman Y Gomez concept. The business generates revenues of more than $90 million, each site averaging $44,000 a week turnover. Some generate more than $80,000 a week in prime spots. “We understand that big rents bring in big revenues. In Australia, what is important is picking AAA locations. We are starting to generate really high revenue growth in some of these big stores. In Australia, if you don’t have a big top line it is hard to dominate and win,” Marks said.

Private equity firms plan joint bid for Middle East foodservice giant: KKR and CVC Capital Partners are working on a joint bid for Americana Group, a Kuwaiti company that operates fast food franchises including TGI Friday’s, KFC and Pizza Hut in the Middle East and North Africa, The Wall Street Journal has reported. Americana, also known as Kuwait Food Co, has a market value of more than $4 billion, so a leveraged buyout of the company may rank as one of the largest ever in the Middle East. Private equity firms such as New York-based KKR and CVC, based in London, have been known to team up to work on large and complex acquisitions. The two worked together in 2007 on an unsuccessful £11 billion ($18.52 billion) bid for UK supermarket chain J Sainsbury.

Balderton Capital backing of Crowdcube named Deal of the Month: Balderton Capital’s £3.8m backing of Exeter-based crowd-funding platform Crowdcube has been named Insider Media’s Deal of the Month for July. The venture capital firm pledged the finance as part of Crowdcube’s £5m funding round to expand internationally and double its workforce to 50 employees. The company also plans to use the finance to open new offices in London and Scotland, as well as expanding its South West base. Insider Media’s news editor David Casey said: “Balderton Capital’s £3.8m investment happened alongside a £1.2m crowd-funding pitch – one which took just 16 minutes to raise. The move marked the first time that any sizeable fundraising has meshed traditional and alternative finance methods and is surely a sign of things to come. Such investor demand also outlines the confidence that exists for Crowdcube’s business model and expansion plans.”

Teenager becomes north Lincolnshire’s youngest ever licensee as she re-opens Enterprise inns pub: A teenager has re-opened a village pub after qualifying as North Lincolnshire’s youngest ever licensee. Chloe Myers – 18 last December – has taken charge at The Horn Inn, Messingham. She said: “Being young in the pub trade is not a disadvantage. In fact it’s a plus.” The teenager has signed a ten-year tenancy on The Horn with owner Enterprise Inns. She did so after forming a new company called Michlo Inns with Mike Sargent, the landlord at the nearby Beckwood. Myers said: “I served my apprenticeship in the pub trade from the age of 15 as a waitress so it’s nice to have Mike advising me.” The new landlady at the Horn has re-introduced the Wednesday live music night and is serving pub food daily, with roasts on Sundays and pies on Thursdays.

YO! Sushi boss target 80% internal promotions: YO! Sushi chief executive Vanessa Hall has told The Daily Express she is targeting 80% internal promotions. About 55% of appointments are internal promotions at the moment. Hall said: “If we can get the right personalities and right values we can try to develop them over a number of years. With new openings you have to replenish your talent and that’s what we work hard to do. This industry is all about people and your competitive edge is your people. As an industry we are one of the fastest-growing employers.” YO! Sushi is expanding at the rate of ten sites next year.

Restaurant and leisure scheme goes on market for £32.8m: Swindon’s Regent Circus leisure and retail development has gone on the market with a £32.8m price tag months before it is due to open. Building work on the 97,000 sq ft scheme, which includes a six-screen cinema, seven restaurants and a Morrisons supermarket, is expected to finish within the next couple of months. It is due to open to the public early next year. According to developers Ashfield Land, just one of the restaurant units remains unlet – making the scheme more than 94% pre-let. The scheme, which is transforming the five-acre former derelict Swindon College site, is being advertised for sale by property agency JLL which says it will have a rental income of more than £2m a year. The 47,780 sq ft leisure part of the scheme is anchored by a 19,000 sq ft digital cinema to be operated by Cineworld, the UK’s largest multiplex chain with 79 cinemas. The remainder of the leisure space will be taken up by restaurants – signed up so far are Prezzo, Ask, Nando’s, Coal Grill and Bar, Jimmy’s World Grill & Bar and Gourmet Burger Kitchen.

Sky launches Sky Sports News HQ for pubs and bars: Sky is launching Sky Sports News for pubs and bars today. New programmes – including ‘The Morning View’, ‘News HQ at 5’ and ‘Sky Sports Today’ – will complement existing shows on the schedule, as well as showcasing other content on the Sky Sports channels. This service helps establish pubs and bars as a “go-to” sports venue – using Sky Sports News HQ alongside live sport ensures that viewers never miss a thing. David Rey, Sky Business managing director, said: “Sky Sports is rated as the best broadcaster for sports coverage by out-of-home viewers and Sky Sports News is the number one sports news service in the UK and Ireland. The launch of Sky Sports News HQ will extend and enhance the experience for sports fans in the pub, giving customers even more reason to stay longer and spend more.”

Fuller’s set to go own way on sale of pub to community group: A deal that would have seen Fuller’s sell the closed Red lion pub in Bloxham to a community group appears to be off. Chairman of the group Bloxham Red Lion Hub Limited Colin Challenger said the village had £300,000 to immediately hand over to secure the sale but the committee is concerned about a ‘raft’ of unusual terms and conditions which render the scheme impossible. These include a 75% ‘uplift’ clause should planning consent be granted within 25 years and a demand for a mortgage of the property to secure that obligation. A spokesman for Fuller’s said: “We had a number of substantially higher offers, but we held back on these in order to facilitate the purchase of this pub by the Bloxham Red Lion Hub Limited (BRLHL). We were under the impression we had reached an agreement with BRLHL, which achieved their aims, namely safeguarding the future of the pub and providing the ability for BRLHL to develop the outbuildings, but in return for accepting a significantly reduced price we did have a condition around an enhanced payment should BRLHL choose to close the pub and change its use or further develop the site. BRLHL has rejected this offer and we are disappointed not to have been able to agree terms. As a result of BRLHL pulling out, we are now close to agreeing terms with another party.”

Pub-buying REIT acquires three shopping centres: NewRiver Retail Limited, the UK REIT specialising in value-creating retail property investment and active asset management which bought 202 Marston’s pubs last November, has exchanged contracts for the acquisition of a portfolio of three shopping centre assets, part of the Swallowtail portfolio, for a total of £140,132,155, equating to a net initial yield of just under 8%. The acquisition was funded through the company’s joint venture with the Bravo II partnership (a fund advised or managed by Pacific Investment Management Company LLC) with both parties taking a 50% equity stake. The portfolio was acquired using existing cash resources ahead of a new debt-facility, which is at an advanced stage. The shopping centre portfolio comprises 758,000 sq ft of retail space located in Hastings, Newton Mearns, an affluent town south west of Glasgow and Newtonabbey, an affluent district north of Belfast. With an annual footfall in excess of 15 million this high performing portfolio is let to 185 tenants including major brand retailers such as Marks & Spencer, Asda, Primark, Next, Top Shop, H&M and Poundland. The low average vacancy rate at 3.5% reflects the strong underlying retail sales performance of the portfolio.

Punch Taverns delays launch of debt-for-equity restructure: Punch Taverns has delayed the launch of its £2.3bn debt restructuring to conclude discussions with stakeholders. The company said that it believes the restructuring can be launched within the next ten days. This morning, the company stated: “On 18 July 2014, Punch announced that covenant waivers had been approved in respect of the Punch A and Punch B securitisations. These waivers are subject to various conditions, including that a restructuring implementing the proposals announced by the Company on 26 June 2014 is launched by 11 August 2014. This condition is subject to a cure period of up to ten business days. Punch announces that the launch of the restructuring has been delayed, as some additional time is required to conclude discussions between certain stakeholders, and for the documentation to be finalised. The Board believes that a restructuring on terms, which are broadly similar to those announced on 26 June 2014, can be launched within the ten business day cure period. However, there can be no certainty that a restructuring will be launched within this period. The Board continues to believe that a consensual restructuring is required to avoid a near-term default in the Punch A and Punch B securitisations, which would have material adverse consequences for all stakeholders and, in particular, for shareholders.” The restructuring will see current equity holders reduce their stake in the company to 15% after new cash is injected by bondholders in a debt-for-equity swap. The refinancing will result is debt being reduced by £600m to £1.56bn, a reduction of 26%. The Mail on Sunday reported that an estimated £30m has been spent by Punch Taverns on trying to broker a deal between 16 different classes of bondholders and other stakeholders.

British brewers invited to export market event: British brewers have been invited to take advantage of new export markets – with a ‘meet the buyer’ event tomorrow (Wednesday) at Brewers’ Hall Brewers. Brigid Simmonds, British Beer and Pub Association chief executive, said: “This is a great opportunity. Many BBPA members are already on board, but there are still places available for other brewers for the ‘meet the buyer’ sessions. It is also great to see the industry’s export strategy being brought to life, through an event like this. While our exports outside the EU were up 46% since 2008, there are still huge opportunities for UK brewers to exploit.” The event takes place next Wednesday at Brewers’ Hall, Aldermanbury Square, London EC2V 7HR. Brewers wishing to attend should register on the UKTI website: https://www.events.ukti.gov.uk/global-inward-beer-buyer-mission/

Story of the Day:

Industry News:

Company News: