Hong Kong’s richest man has made a bid to become one of the biggest players in the British beer business, with a £4.6bn takeover of Greene King (GNK) the brewer and owner of 3,000 pubs. CK Hutchison, the conglomerate controlled by 91-year-old billionaire Li Ka-shing, sprung a surprise on Monday afternoon with an 850p-a-share deal that valued shares in the 220-year-old brewer and pub company at a premium of more than 50%. The deal further expands Mr Li’s involvement in the British consumer economy and property. CK Hutchison already owns Superdrug and the mobile network Three, among other UK assets. The bid won the support of Greene King’s board, who in May bid farewell to the company’s longstanding boss Rooney Anand. CK Hutchison’s planned takeover of Greene King immediately raised fresh concerns over the future of pubs, despite reassurances that the owners believe “pubs will continue to be an important part of British culture”. The Campaign for Real Ale (Camra) has warned that about two pubs per day are being closed, with many redeveloped as housing. Last year Fuller’s, one of London’s oldest breweries, was bought by Japanese firm Asahi.
Ryanair Holdings (RYA) has made a last-ditch attempt to stop 180 Dublin-based pilots walking out at the end of this week. Bosses sought an injunction from Ireland’s High Court on Monday to prevent Irish trade union Forsa from holding a strike on Thursday and Friday in a dispute over pay and conditions. Forsa, which represents Ryanair’s Irish based pilots, told the court that the airline was not entitled to the injunction. The Ryanair pilots’ strike threatens to disrupt passengers’ travel ahead of the bank holiday, which is traditionally the busiest weekend of the year for British airports. The hearing was adjourned until Tuesday.
Pub stocks were given a top-up just before the bell on Monday, as Greene King (GNK) acceptance of a takeover bid by Hong Kong real estate giant CKA sent its shares surging. The news sent other UK pub stocks surging in the final hour of trading, the growth lifting travel and leisure to be the best-performing stock sector across Europe. Investors may have high hopes for further takeovers, especially after TDR Capital (the private equity-owned group behind Slug & Lettuce) agreed a £3bn takeover of Ei, formerly known as Enterprise Inns, the UK’s biggest pub chain. Marston’s (MARS) rose by 9.6p to 115p, its biggest climb since the end of November 2017. Wetherspoon (J.D.) (JDW) rose 111p to £15.82, while Mitchells & Butlers (MAB) rose 17.5p to 324p. Wagamama and Frankie & Benny’s-owner Restaurant Group (RTN) was also feeling the effects, gaining 7.9p to end at 145.5p. “For the battered pub trade, it’s clear the real value lies in the property,” said Neil Wilson of Markets.com, suggesting the “whopping premium” CKA was prepared to pay for Greene King showed it saw “significant value in the property portfolio”.
Kaz Minerals (KAZ) was the biggest faller for the second time in three days, as its exposure to a globally-weak copper market continues to sink its share price. By the end of trading it had fallen 27.3p to 407.2p.
Mitie Group (MTO) is to sell off its food division to a company that provides catering for the Queen as it looks to further simplify its business as part of a turnaround effort. CH&CO, which holds a Royal Warrant and also runs cafes at London Zoo and Kew Gardens, will pay up to £85m for the unit, whose brands include Gather & Gather and Creativevents. The deal is part of Mitie boss Phil Bentley’s attempts to move out of “non-core” lines of work to focus on its main services such as cleaning, security and building maintenance. CH&CO will pay £73m when the deal completes and the rest depending on how well the unit performs over the next four years. The Reading-based company turned over £300m last year and employs 6,200 staff. Mitie Catering’s senior management team will move with the unit, and the two companies have signed an agreement that means Gather&Gather’s brand will remain exclusive to Mitie’s clients.
Safestore Holdings (SAFE) is to expand into the Netherlands after forming an alliance with European real estate fund Carlyle. The company is teaming up to buy M3 Self Storage, which operates six sites in Amsterdam and Haarlem. Safestore will invest €5m (£4.6m) for a one-fifth share in the venture and will also receive a fee for providing management services. Frederic Vecchioli, chief executive, described the Dutch self-storage market as “attractive”, being the forth largest in Europe, with scope for further acquisitions. Safestore is pursuing a “multi-country” strategy to expand beyond its core market. It is the largest self-storage group in the UK, with 119 sites, and a further 27 around Paris.
Questor: no debt and a long record of divi rises – after its summer stumble Barr (A.G.) (BAG) is a buy. Questor share tip: although its explanations for last month’s profit warning were a little lame, the drinks firm’s problems look temporary
