M&B disposal enters new phase

Mitchells & Butlers aims to sell off its 53 remaining franchised pubs by the new year in the latest phase of the pub operator’s effort to dispose of more than £500 million-worth of “non-core” assets.

The news follows this week’s completion of M&B’s disposal of 333 non-core pubs to Stonegate Pub Company.

M&B shareholders approved the sale of these wet-led pub assets at a meeting on 26 October. Venues identified for disposal included 52 branches of the student pub chain Scream, 71 music and late night bars, 75 town centre pubs and 67 community pubs in residential areas.

The group now plans to convert remaining venues within these categories into the food-led brands earmarked for expansion.

M&B has classified its non-core pubs as those in which food made up 13% of revenue in the year ending 26 September 2009. At £14,000, average weekly turnover for these non-core pubs was 32% lower than for the food-led pubs that now form the operator’s main focus.

It is expected that several of these franchised pubs will be bought by their tenants. M&B is already understood to have accepted individual offers for 15 sites from 13 franchisees.

Gabriel Savage, 16.11.2010