Greene King in £4.6bn Hong Kong takeover
Written by News on 19/08/2019
Britain’s largest pub and brewery company Greene King has agreed to a £4.6bn sale to Hong Kong-based conglomerate CK Asset Holdings.
CK Asset Holdings, founded by Hong Kong’s richest man Li Ka-shing, will pay £2.7bn for the 220-year old brewery company and take on its debt, worth an additional £1.9bn.
Greene King, based in Bury St Edmunds, Suffolk, was founded in 1799 and operates nearly 3,000 pubs, restaurants and hotels, and owns brands including Hungry Horse and Chef & Brewer.
Greene King IPA, OId Speckled Hen and Abbot Ale are among its beer brands.
Nick Mackenzie, chief executive of Greene King, said: “Greene King has a well-invested estate in prime locations, leading brands, a rich history and a talented team of around 38,000 people serving millions of customers across the country every week.
“CKA is an experienced UK investor and shares many of Greene King’s business philosophies.
“They understand the strengths of our business and we welcome their commitment to working with the existing management team, evolving the strategy and investing in the business to ensure its continued long-term growth.”
The buyer CK Asset Holdings, counts real estate, energy assets and aircraft leasing among its business interests.
Greene King’s shares shot up 50% by market close on Monday, to meet the 850p per share being offered by CK Asset Holdings.
The brewer saw full-year pre-tax profit drop in 2018, despite a summer of favourable weather and World Cup fever, down 12.5% to £172.8m on group revenue that grew 1.8% to £2.2bn in the year to 28 April.
This was during a period in which Greene King reduced the average number of pubs trading by 2.5%.
Operating profit was down 10.7% to £27.4m, driven by the estate reduction, increased costs and lower production volumes in two of its breweries.
The small pre-tax earnings and revenue increases were driven by the performance of its Pub Company division, which saw a rise in like-for-like sales of 2.9% and revenue growth of 1.8% to £1.8bn, which helped to fend off the effects of the pub closures.
Greene King’s agreed takeover by CK Asset Holdings marks a continuing interest of Asian giants in the UK brewing sector, after London Pride owner Fullers sold its beer-making operations to the Japanese company Asahi in January for £250m.
(c) Sky News 2019: Greene King in £4.6bn Hong Kong takeover
