Greene King leaps last hurdle in Spirit merger
Greene King moved within touching distance of completing its takeover of Spirit Pub Company yesterday after announcing the acquisition was no longer subject to regulatory approval.
The announcement that the company had waived approval from the Competition and Markets Authority (CMA) means the acquisition is expected to take place within weeks.
Last week Greene King said it was submitting plans to the regulator which would see it dispose of 16 pubs. The decision came after the CMA said their continued possession would be in breach of anti-monopoly rules post-acquisition. The divestitures mean the firm can now proceed with closing the deal, with shares in Spirit expected to be suspended on 23 June before being delisted and trading in new Greene King shares commences.
The merger will result in Greene King operating over 1,800 pubs with pro-forma revenues expected to be in excess of £2.1bn and delivering £30m in cost synergies per annum. In addition, the company will be able to diversify its portfolio by taking on the Flaming Grill, Good Night Inns and Wacky Warehouse brands.
Spirit’s history has been closely tied with Greene King rival Punch Taverns, which originally founded Spirit as a subsidiary in 1999 before it was spun-off three years later. Unusually, Punch proceeded to reacquire the company in 2006, before again demerging for a second time five years later in 2011.