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Punch Taverns awaits crunch vote on future
Thousands of UK pub landlords are anxiously awaiting a crucial vote on the future of debt-laden Punch Taverns in the hope that it will not slip into administration.
Punch Taverns, which operates around 4,000 pubs in the UK, has been in talks for the last 14-months with lenders over a proposed restructuring to consolidate its massive £2.3 billion debt.
On Valentines day, lenders will vote on the pub companies latest proposal to restructure requiring a vote of 75% to move forward.
If the plans are voted down, it is likely Punch Taverns will default on its repayments and slip into administration leaving publicans in fear of losing their premises and the deposits paid out to Punch to become landlords – in some cases more than £20,000.
Steve Kemp, GMB lead officer for tied pub tenants, said: “This proposal to restructure Punch’s debt pile puts into sharp relief the wrongly held view that shareholders in a pubco own a pub business.
“In fact the Punch shareholders don’t own a pub business; they own a holding company which invests in and manages incomes from pubs- these are called pub securitisations.
“These securitisations are the infernal machine that is closing pubs across the country. It is the same infernal machine that drove Southern Cross care homes to the wall.”
According to a report by The Metro, major creditors indicated last week that they were likely to oppose the restructuring despite Punch chairman Stephen Billingham saying failure to agree “will lead to a much worse outcome with considerable uncertainty for the business”.
A spokesman for Punch Taverns said: “An end to uncertainty is critical for Punch Taverns and its tenants.
“The restructuring outcome rests with city institutions whose decisions are being watched very carefully. We are doing everything we can to avoid default.
“But, in the event it happens, we would hope an administrative receiver would recognise the importance of the tenants to the future of the business and act in their interests.”
Hallelujah, cometh the day, As a former Landlord who ran a successful Pub Business. I cannot wait to see the imminent demise of a company whose Business Model is ultimately flawed, They lie and use Bully Boy tactics and underhand methods that have not only ruined many peoples lives, but a whole industry. I will cheer and drink myself to a merry state at the passing of these robbing Barstewards.
I agree 100% with you, Paul. Totally 100% I am a former landlord for 30 years ’78 – 2008. Remember the Monopolies Commission decision in 1991 and how that made life ‘running a pub’ almost unprofitable. Inexperienced people were taking pubs on with their redundency money and losing their money to the PUBCO’s. I will also have a drink and cheers to you Paul.
I can drink to the greedy management losing their cushy jobs and see if they can handle living not knowing where the next penny is coming from. I am not sure they will ever know how it felt to be a landlord/lease holder of a Punch pub that they knew was dying and were happy that you used your own money to keep a pub open while Punch pocketed everything.
I can’t drink to the demise of Punch as there are so many people who will lose not only all their savings but their business and home too. Left destitute. That is just not fair. How do you have debts of 2.3 BILLION POUNDS FFS?
I thought in the last 3/4 year as a Punch lease holder I was either going mad or going to top myself. Thank god I met a BRM who listened to my plight and helped us to get out, I owe him my life and my sanity.
I wish those not so fortunate as I was the very best and really hope there is a way to for you all to have a future in or out of Punch.
Colin
Punch and Enterprise would never have come into existance were it not for a previous Conservative government bringing in the crazy Beer Orders legislation, which quickly precipitated the breakup of the big brewers’ estates, which had on the whole been extremely well-managed by the likes of Bass and Whitbread.
To this day it still beggars belief that the misguided politicians involved in drafting this legislation, headed by Lord Young (who was berated in the Lords a few months ago when said of the UK economy that ‘We’ve never had it so good’) brought in a law which prevented the big brewers from tying more than 2,000 pubs to their beers and yet allowed the new Pubcos to tie unlimited numbers of pub tenants to their sky-high range of drinks when they didn’t brew a drop of beer between them.
Madness !
And let us not forget that CAMRA played a big part in lobbying the government to introduce the disastrous Beer Orders.
I criticised CAMRA in a letter in What’s Brewing at the time saying that all that this legislation would achieve would be much worse pub landlords and that the big brewers such as Bass, which had legally built up an enviable estate of over 9,000 pubs, should not be trampled on by retrospective legislation and should be allowed to tie all iof their current pubs, thereby protecting the many thousands of jobs in the pubs and at their Burton brewery.
And what happened was that the Beer Orders were introduced and Bass predictably threw in the towel selling their tenanted pubs to the newly-created venture-capital backed Punch Taverns and their wonderful old brewery was sold to the Yanks.
Well done CAMRA and well done the Tories, although it has to be said that they received all-party backing in the Commons. What a bunch of meddling busybodies !
The main beneficiary from the Beer Orders has been Wetherspoons – who can sell drinks cheaper than some tied Pubco tenants can buy in for.
If the big brewers had been allowed to keep their estates intact it would have saved thousands of pubs from closing unnecessarily as the Pubco model is untenable and absurd.
Clearly CAMRA are in bed with Wetherspoons as all CAMRA members are posted £20 worth of 50p beer vouchers each year, thereby diverting their members away from small free houses and tenanted pubs.
My Wetherspoons vouchers go in the bin and I would urge other members to do likewise.
I am a freetrader, with thirty years trading behind me and a CAMRA Life Member.
Hugh Price
Tynemouth Lodge Hotel
Tynemouth
Well said Mr Price. I agree whole heartedly with your good self. Camra are a bunch of wet towels and it’s association with Weatherspoons is disgusting. Camra are supposed to support good pubs. In NO WAY is a weatherspoons a good pub. It is a chain. It is like farmers standing up and praising Tesco for stocking their produce whilst Tesco deprives them of a living wage. Weatherspoons constantly under cut private business and move into towns to exterminate the competition. I only wish it was weatherspoons at risk as well as punch and whilst we are at it, can we get rid of Enterprise Inns as well please
If any of you above would kindly email me I would be most grateful Punch have sold off a whole heap of pubs behind peoples back in the London area and are refusing to communicate with tenants. I have been caused alarm and distress physically and mentally and need some urgent advice.
I have been waiting to sign a new contract then got told the pub is being sold , I am in London I took this which was locked up for nth build it up put all my money into it for the last 6 years and get told this this week
We have been in a punch pub for under 12 months and it is not working out, we are out in the sticks serving excellent food, but people don’t want to travel out to us. I spend most days crying in desperation and depression. We are having to invest our own money to make ends meet. Punch have given us 6 weeks free rent and for the next 8 weeks are charging £200 a week to help us. I desparately need to get out of the business before it makes me ill and ruins everything around me. Punch removed the 6 month cooling off period as ours was a transfer of lease, or we would definately of used this clause. Punch have told us we can give notice, but it will cost us 6 month rent which is £18,000 – which we don’t have. I really don’t know what to do. Our BDM is an awful person and is the most unhelpful, approachable person I know. Any good ideas or suggestions will be so gratefully received?
Hi Janet, we are in the same position. We have a lease pub with punch & have been trying to sell for a year now but all buyers pull out because of Punch’s situation. Have you managed to agree anything with them? My partner is very depressed now & feels trapped but we have no money to buy our way out & was banking on getting money from the sale of a lease. Thanks, Danielle