Marston’s has acquired eight pubs from SA Brain & Co.
Last year the Midlands-based pub company struck a deal with the Cardiff-based family-owned brewing and hospitality firm to take on its estate of 156 pubs.
Many of the pubs are being leased to Marston’s on inflation linked long lease agreements of 25 years. It will provide what is left of SA Brain & Co with an annual rental income of £5.5m.
The deal safeguarded 1,300 SA Brains & Co pub staff who have transferred over to Marston’s on the same employment terms.
Marston’s has now confirmed that it has acquired the freehold interest in eight of the pubs in the Brains estate.
It wouldn’t disclose the identity of the acquired pubs, but confirmed that seven are being converted into franchises.
The value of the deal was £4m. Marston’s said it had no appetite to acquire further Brains pubs, with its strategy focused on reducing its borrowings to below £1bn by financial year 2024. However, for its Brains leased estate it sees the potential for more pubs to be operated under the franchise model.
It now leases 147 Brains pubs following expiry of a number of leases since the deal in December.
On the acquisition of the eight pubs, Marston’s said: "They will be treated the same as the other pubs in the core estate which Marston’s are operating on long term lease agreements.”
While there was strong early stage interest, SA Brain & Co has put the sales process for its brewery on hold until there is clarity on when Covid restrictions are lifted. All pubs in Wales and the rest of the UK are currently closed.
However, Marston’s has confirmed it is not interested in making a bid for the brewery, with its focus now on being a pub company having entered into a joint venture with brewing giant Carlsberg in which it has a minority stake.
The brewery sales process will resume later in the year. If a buyer isn’t secured, then SA Brain & Co is committed to finding an alternative supplier for the Brains branded pubs operated by Marston’s.
Around 85% of the beers and lagers produced by the brewery in Cardiff Bay was, pre-Covid, for the Brains pub estate, with the consumer market accounting for around 15% of sale.
Outside of the Brains deal Marston’s has a portfolio of 106 other pubs in Wales. UK-wide it has 1,471 pubs.
