Stonegate eyes £1bn sale of 1,000 sites: Stonegate Group, the UK’s largest pub company, is ramping up plans for a £1bn sale of more than 1,000 pubs as the company looks to pay down more than £3bn of debt. The Sunday Times reported senior executives at Stonegate have held discussions with potential advisers to explore their options for almost a quarter of the company’s 4,300-strong pub estate. Best known as the owner of the Slug & Lettuce and Be At One brands, Stonegate saw turnover increase to £1,747,000,000 for the year ending 29 September 2024 compared with £1,719,000,000 the year before but has accrued debts of £3.20bn, mostly due to its merger with Ei Group in 2019. The 1,034 pubs in question are referred to internally as Stonegate’s “platinum” collection and considered some of its best properties. Industry sources said the value of the pubs could be as high as £1bn. Stonegate tried, unsuccessfully, to sell a similar number of pubs in 2023. Following this, it securitised the platinum pubs with a £638m loan from private equity house Apollo, which turned them into a separate entity within the company and helped ease the pressure on Stonegate’s finances. “The situation they ended up in is a structure whereby they can sell off chunks of that business without it damaging the rest of [it],” said a pub industry source. Stonegate bosses are thinking about their options now because a non-call period on Apollo’s loan, during which Stonegate has been prevented from selling or refinancing the pubs, ends in January. It is thought that one option being considered by executives is selling the pubs off in groups of hundreds rather than pursuing a sale of the entire group. In August, the credit ratings agency Fitch downgraded Stonegate’s rating to CCC+, indicating a risk of a debt-repayment default, on fears of the impact of rising costs on the company. Because the platinum pubs are in effect carved out, they were not included in Fitch’s assessment. It is understood the platinum pubs are now generating about £90m in Ebitda. They are spread across England and Wales. All of the platinum pubs are freehold properties. Stonegate declined to comment. Stonegate features in the Premium Club Turnover & Profits Blue Book, the latest edition of which was sent to Premium Club subscribers on Friday (15 November) and features 1,182 companies. Stonegate’s turnover of £1,747,000,000 is the ninth highest in the database. Companies can now have an unlimited number of people receive access to Propel Premium for a year for £995 plus VAT – whether they are an operator or a supplier. The single subscription rate is £495 plus VAT for operators and £595 plus VAT for suppliers. Email kai.kirkman@propelinfo.com to upgrade your subscription.

Costa Coffee bidders dwindle as private equity firm KKR pulls out: One of the potential bidders for Costa Coffee has given up its pursuit of the Coca-Cola-owned business just days before indicative offers are due. The Sunday Times reported KKR, the New York-listed private equity business, had been interested in Costa when it was first put up for sale by the American drinks giant earlier this year. However, it is now understood to have decided against making an offer. Coca-Cola paid £3.9bn for Costa Coffee in 2018 when it was sold by Whitbread. Other potential bidders for the business include private equity firms TDR and Bain, while Centrium Capital, which owns Chinese business Luckin Coffee, is also reported to be considering an offer. City sources said Coca-Cola seemed unlikely to achieve the price that it paid for Costa if it decides to proceed with the sale. James Quincey, Coca-Cola’s chief executive, has said that Costa has “not quite delivered” and is “not where we wanted it to be” in the financial returns that it generates. Coca-Cola did not respond to requests to comment. KKR declined to comment, as did Lazard, which is advising Coca-Cola. Costa Coffee started life in 1971 in London and now has more than 2,700 shops in the UK and Ireland, and another 1,300 around the world. It made a push into America in 2011 with the takeover of Coffee Nation and has since expanded into convenience, operating more than 14,200 express coffee machines in Britain. In 2023, Costa reported an annual loss of £13.8m on revenue of £1.2bn, according to the most recently available set of accounts at UK Companies House.

Host of sector business named in Best Companies to Work lists: A host of sector business have been named in this year’s Best Companies to Work lists. In the 15-strong big companies list, which consists of businesses with more than 2,000 employees, motorway services operator Roadchef was third. In the 100-strong large companies list, premium gastropub operator Parogon Group was 11th, while Scottish independent restaurant and bar operator Buzzworks Holdings came 29th – a rise of 31 places and its highest ranking to date. Head of people, Nicola Watt, said: “We’re fortunate to have such talented people in the Buzzworks team, and we remain committed to investing in their growth and development within the business. Our people are at the heart of everything we do, and they continue to drive our success.” Elsewhere, in the large companies list, award-winning steak restaurant business Hawksmoor was 42nd, high-ropes adventure course operator Go Ape was 50th, skinny chops concept Blacklock was 51st, London eastern Mediterranean restaurant concept Brother Marcus was 66th, Inn Collection Group came 68th, Brava Hospitality Group-operated brand Prezzo Italian was 79th, Brewhouse & Kitchen, the UK’s largest brewpub group, came 87th, and Taiwanese dim sum brand Din Tai Fung UK was 96th. In the 100-strong mid-companies list, which is businesses with between 100 and 249 employees, Bleecker Burger, the concept founded by Zan Kaufman in 2012 was 29th, Northern Monk, the Active Partners-backed Leeds brewer, came 50th, Fever-Tree was 52nd, street food collective Kerb was 64th, quick service sushi roll concept SushiDog came 81st, and Marugame Udon, the international udon noodles and tempura restaurant brand, was 93rd.